Capital Gains and the Military

[edkaner]

I am in the U.S. Navy and bought a TH in Virginia in 1985, living in it only until 1988. Since then I have been unable to live in it due to military duty out of the country or elsewhere in the states. It has been my principle residence (not owning anything else) and I have rented it out to keep up the payments. I am about to sell the TH. Since I have not been able to live in it because of my my military duties do I have a case with the IRS to NOT have to pay capital gains or depreciation since I have not lived in it two of the last five years? If the anser to that question is yes, I must pay; can I get around the capital gains if I reinvest into a larger home? I don't earn much on the TH, but would like to keep what I can. Appreciate the assistance.

 

[David J. Miller]

Not living in the home does not exempt you from capital gains. Not sure but there may be special provisions for military personnel stationed overseas. It may still be considered your primary residence for tax purposes but you'll need to talk to a tax attorney or CPA.

 

[Tracey]

You aren't elegible for the capital gains exclusion, but there might be other tax breaks of which you can take advantage. Stop by an h&R Block office. They're usually pretty good.

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This is not legal advice and you are not my client. Double check everything with your own attorney and your state's laws. [email protected] - please include some facts so I know who you are!