Which of the following statements regarding the exclusion of gain on the sale of a principal residence is correct?

Question

Quizplus · Accepted Answer

The IRS rules allow for a taxpayer to own multiple homes that can qualify for the exclusion as long as they meet the ownership and use tests. They can only claim the exclusion for one property at a time, however. Option A is incorrect because a taxpayer must have lived in the property as their primary residence for at least two of the past five years to qualify for the exclusion, not renting it out at the time of the sale. Option C is also incorrect because the requirement is that the taxpayer must have lived in the residence for at least two of the past five years, not necessarily at the time of the sale. Option D is incorrect because only one spouse is required to meet the ownership and use tests to qualify for the $500,000 exclusion.

Which of the Following Statements Regarding the Exclusion of Gain