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Residence to commercial

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Junior Member
What is the name of your state? MO

I'm not sure if this is more appropriate in the Tax forum or Real Estate forum, so I apologize if members thin this is off-topic.

I have lived in a residence for 4 years. The entire area around the house is being commercially developed. My house is zoned commercial, but is grandfathered in as a residence.

Depending on the development that goes in, I may not want to stay in the house (noise, traffic, etc). If I should lease it as commercial property (office, etc.) for a couple of years and then sell it, would I still be able to avoid up to $500,000 (couple - 250k per person) in capital gains tax since it was still my primary residence for 2 of the previous 5 years? Or does the commercial designation kill that opportunity?

Thanks for any advice or direction you can provide.

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