Taxpayer owns a home in Atlanta.His company transfers him to Chicago on January 2, 2012, and he sells the Atlanta house in early February.He purchases a residence in Chicago on February 3, 2012.On December 15, 2012, taxpayer's company transfers him to Los Angeles.In January 2013, he sells the Chicago residence and purchases a residence in Los Angeles.Because multiple sales have occurred within a two-year period, § 121 treatment does not apply to the sale of the second home.

Question

Quizplus · Accepted Answer

Section 121 allows for the exclusion of gain from the sale of a principal residence if the taxpayer meets certain conditions, including ownership and use tests. However, exceptions exist for unforeseen circumstances, such as job relocation, which may allow for a partial exclusion even if multiple sales occur within two years.

Taxpayer Owns a Home in Atlanta