Darren (single) purchased a home on January 1, 2014 for $400,000. Darren lived in the home as his primary residence until January 1, 2016 when he began using the home as a vacation home. He used the home as a vacation home until January 1 2017 (he used a different home as his primary residence from January 1, 2016 to January 1, 2017). On January 1, 2017, Darren moved back into the home and used it as his primary residence until January 1, 2018 when he sold the home for $500,000. What amount of the $100,000 gain Darren realized on the sale must he recognize for tax purposes in 2018?

Question

Quizplus · Accepted Answer

The Answer of Darren (single) purchased a home on January 1, 2014 for $400,000. Darren lived in the home as his primary residence until January 1, 2016 when he began using the home as a vacation home. He used the home as a vacation home until January 1 2017 (he used a different home as his primary residence from January 1, 2016 to January 1, 2017). On January 1, 2017, Darren moved back into the home and used it as his primary residence until January 1, 2018 when he sold the home for $500,000. What amount of the $100,000 gain Darren realized on the sale must he recognize for tax purposes in 2018?

Darren (Single) Purchased a Home on January 1, 2014 for $400,000