Publication 523 - Selling Your Home - 2003 Page 3
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314797 Sales of Business Property
them, your main home is ordinarily the one you live in most
of the time.
8822 Change of Address
8828 Recapture of Federal Mortgage Subsidy
Example 1. You own and live in a house in the city. You
also own a beach house, which you use during the sum-
See How To Get Tax Help, near the end of this publica-
mer months. The house in the city is your main home.
tion, for information about getting these publications and
forms.
Example 2. You own a house, but you live in another
house that you rent. The rented house is your main home.
Factors used to determine main home. In addition to
Main Home
the amount of time you live in each home, other factors are
relevant in determining which home is your main home.
This section explains the term “main home.”
Those factors include the following.
Usually, the home you live in most of the time is your
main home and can be a:
1) Your place of employment.
•
House,
2) The location of your family members’ main home.
•
Houseboat,
3) Your mailing address for bills and correspondence.
•
Mobile home,
4) The address listed on your:
•
Cooperative apartment, or
a) Federal and state tax returns,
•
Condominium.
b) Driver’s license,
To exclude gain under the rules in this publication, you
c) Car registration, and
generally must have owned and lived in the property as
d) Voter registration card.
your main home for at least 2 years during the 5-year
period ending on the date of sale.
5) The location of the banks you use.
Land. If you sell the land on which your main home is
6) The location of recreational clubs and religious orga-
located, but not the house itself, you cannot exclude any
nizations you are a member of.
gain you have from the sale of the land.
Example. On March 4, 2003, you sell the land on which
Property used partly as your main home. If you use
your main home is located. You buy another piece of land
only part of the property as your main home, the rules
and move your house to it. This sale is not considered a
discussed in this publication apply only to the gain or loss
sale of your main home, and you cannot exclude any gain
on the sale of that part of the property. For details, see
on the sale of the land.
Business Use or Rental of Home, later.
Vacant land. The sale of vacant land is not a sale of
your main home unless:
Figuring Gain or Loss
•
The vacant land is adjacent to land containing your
home,
To figure the gain or loss on the sale of your main home,
•
You owned and used the vacant land as part of your
you must know the selling price, the amount realized,
main home,
and the adjusted basis. Subtract the adjusted basis from
•
the amount realized to get your gain or loss.
The sale of your home satisfies the requirements for
exclusion and occurs within 2 years before or 2
Selling price
years after the date of the sale of the vacant land,
− Selling expenses
and
Amount realized
•
The other requirements for excluding gain from the
sale of the vacant land have been satisfied.
Amount realized
− Adjusted basis
If these requirements are met, the sale of the home and the
sale of the vacant land are treated as one sale and only
Gain or loss
one maximum exclusion can be applied to any gain. See
Excluding the Gain, later.
Selling Price
More than one home. If you have more than one home,
you can exclude gain only from the sale of your main
The selling price is the total amount you receive for your
home. You must include in income gain from the sale of
home. It includes money, all notes, mortgages, or other
any other home. If you have two homes and live in both of
debts assumed by the buyer as part of the sale, and the fair
Page 3
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