Publication 523 - Selling Your Home - 2003 Page 2
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31situations, you may also need to use Worksheet 3 to figure
Important Reminders
a reduced maximum exclusion.
Sale before May 7, 1997. If you sold your main home
Change of address. If you change your mailing address,
before May 7, 1997, and postponed the gain while serving
be sure to notify the Internal Revenue Service (IRS) using
in the Armed Forces, see Publication 3, Armed Forces’ Tax
Form 8822, Change of Address. Mail it to the Internal
Guide, for special rules that are not covered in this publica-
Revenue Service Center for your old address. (Addresses
tion.
for the Service Centers are on the back of the form.)
Date of sale. If you received a Form 1099 –S, Proceeds
Home sold with undeducted points. If you have not
From Real Estate Transactions, the date of sale should be
deducted all the points you paid to secure a mortgage on
shown in box 1. If you did not receive this form, the date of
your old home, you may be able to deduct the remaining
sale is the earlier of (a) the date title transferred or (b) the
points in the year of sale. See Points in Part I of Publication
date the economic burdens and benefits of ownership
936, Home Mortgage Interest Deduction.
shifted to the buyer. In most cases, these dates are the
same.
Photographs of missing children. The Internal Reve-
nue Service is a proud partner with the National Center for
What is not covered in this publication. This publica-
Missing and Exploited Children. Photographs of missing
tion does not cover the sale of rental property, second
children selected by the Center may appear in this publica-
homes, or vacation homes. For information on how to
tion on pages that would otherwise be blank. You can help
report those sales, see Publication 544, Sales and Other
bring these children home by looking at the photographs
Dispositions of Assets.
and calling 1 – 800 –THE – LOST (1 –800 –843 –5678) if
Comments and suggestions. We welcome your com-
you recognize a child.
ments about this publication and your suggestions for
future editions.
You can e-mail us at *taxforms@irs.gov. Please put
Introduction
“Publications Comment” on the subject line.
You can write to us at the following address:
This publication explains the tax rules that apply when you
sell your main home. Generally, your main home is the one
Internal Revenue Service
in which you live most of the time.
Individual Forms and Publications Branch
If you sold your main home in 2003, you may be able to
SE:W:CAR:MP:T:I
exclude from income any gain up to a limit of $250,000
1111 Constitution Ave. NW
($500,000 on a joint return in most cases). See Excluding
Washington, DC 20224
the Gain, later. If you can exclude all of the gain, you do not
need to report the sale on your tax return.
We respond to many letters by telephone. Therefore, it
If you have gain that cannot be excluded, it is taxable.
would be helpful if you would include your daytime phone
Report it on Schedule D (Form 1040). You may also have
number, including the area code, in your correspondence.
to include Form 4797, Sales of Business Property. See
Reporting the Sale, later.
Useful Items
If you have a loss on the sale, you cannot deduct it on
your return.
You may want to see:
The main topics in this publication are:
Publication
•
Figuring gain or loss,
521
Moving Expenses
•
Basis,
527
Residential Rental Property
•
Excluding the gain,
530
Tax Information for First-Time Homeowners
•
Ownership and use tests, and
544
Sales and Other Dispositions of Assets
•
Reporting the sale.
547
Casualties, Disasters, and Thefts
Other topics include:
551
Basis of Assets
•
Business use or rental of home,
587
Business Use of Your Home
•
Deducting taxes in the year of sale, and
936
Home Mortgage Interest Deduction
•
Recapturing a federal mortgage subsidy.
Form (and Instructions)
Worksheets. This publication includes worksheets you
Schedule D (Form 1040) Capital Gains and
can use to figure your gain (or loss) and your exclusion.
Losses
Use Worksheet 1 to figure the adjusted basis of the home
you sold. Use Worksheet 2 to figure the gain (or loss), the
1040X Amended U.S. Individual Income Tax
exclusion, and the taxable gain (if any) on the sale. In some
Return
Page 2
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