Main Home

AAA

DEFINITION of 'Main Home'

A term used by the Internal Revenue Service (IRS) to define the home a taxpayer has lived in most of the time during a given taxation year, or the only home a taxpayer owns. The classification of a taxpayer's main home is important when considering gains resulting from the sale of a main home.

BREAKING DOWN 'Main Home'

When you sell your home, you may be able to exclude the gains from your income for tax purposes if you pass the ownership and use tests. If over the previous five years you have owned the home for more than two years, and it was your main home for more than two years, then you can exclude up to $250,000 ($500,000 for joint filers) in a given tax year.

Losses resulting from the sale of your main home cannot be deducted.

RELATED TERMS
  1. Home Office

    An office located inside the taxpayer's home that serves as the ...
  2. Deferred Gain On Sale Of Home

    An obsolete tax law that applied to homeowners before May 7, ...
  3. Land Value

    The value of a piece of property, including both the value of ...
  4. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
  5. Land

    Property or real estate, not including buildings or equipment, ...
  6. Vacation Home

    A dwelling other than the owner's primary residence that is used ...
Related Articles
  1. Home & Auto

    Top Tips For First-Time Home Buyers

    Follow this step-by-step guide to make your homeownership dreams a reality.
  2. Home & Auto

    Cut Commissions With "For Sale By Owner" Sales

    It takes a lot more work, but selling your home without a realtor can have benefits.
  3. Taxes

    Vacation Home Or Income-Producing Investment?

    There is an alternative to letting your cottage sit empty all year, but turning a profit won't be easy.
  4. Budgeting

    Paring Down Moving Costs

    Unexpected costs can add to the stress of relocation. Plan ahead and anticipate what may pop up.
  5. Credit & Loans

    Avoiding Red Flags with Online Mortgage Lenders

    Using an online mortgage lender can be convenient, but how do you know you can trust one? Follow these tips to make sure the lender is legit.
  6. Credit & Loans

    How To Boost Your Credit Score To Save Thousands

    One of the first steps you should follow before buying a home is to boost your credit score. And how do you do that? Here, we tell you how.
  7. Credit & Loans

    5 Mortgage Loans You Didn't Know About

    These lesser known mortgage loans are often overlooked by potential home buyers.
  8. Economics

    Real Estate: How the Bubble Will Pop

    This real estate bubble is much different from the last one. Understanding it is imperative if you plan on making any investments.
  9. Credit & Loans

    The Hi-Tech Future of Mortgage Applications

    Three sites that are simplifying your path to home ownership.
  10. Home & Auto

    Best Real Estate Apps for House Hunters

    Your dream home might be only a swipe away.
RELATED FAQS
  1. My wife and I both converted our Traditional IRAs to Roth IRAs in Dec 1998 and have ...

    You and your spouse each qualify for a penalty-free distribution of up to $10,000 for the purchase, acquisition or construction ... Read Full Answer >>
  2. Can I take my 401(k) to buy a house?

    Once you reach 59.5, you can use the funds in your 401(k) retirement savings account to buy a house or any other expense ... Read Full Answer >>
  3. Can I take my 401(k) to buy a house for my children?

    Under the standard regulations for 401(k) retirement savings plans, you may elect to withdraw funds from your 401(k) for ... Read Full Answer >>
  4. How is market value determined in the real estate market?

    Anyone who has ever tried to purchase or sell a home has probably heard a lot about the property's fair market value, or ... Read Full Answer >>
  5. What does the American Dream mean to different generations?

    The American Dream at its core is the belief that every generation should enjoy greater prosperity than the generation before ... Read Full Answer >>
  6. When should a real estate broker release earnest money deposit funds?

    As soon as an agent or broker accepts an earnest money deposit, he becomes an escrow agent. This means that, in most cases, ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Tiger Cub Economies

    The four Southeast Asian economies of Indonesia, Malaysia, the Philippines and Thailand. Tiger cub economy indicates that ...
  2. Gorilla

    A company that dominates an industry without having a complete monopoly. A gorilla firm has large control of the pricing ...
  3. Elephants

    Slang for large institutions that have the funds to make high volumes trades. Due to the large volumes of stock that elephants ...
  4. Widow's Exemption

    In general terms, a widow's exemption refers to the amount that can be deducted from taxable income by a widow, thereby reducing ...
  5. Wedding Warrant

    A warrant that can only be exercised if the host asset, typically a bond or preferred stock, is surrendered. Until the call ...
  6. Marlboro Friday

    A reference to Friday, April 2, 1993, when Philip Morris, the maker of Marlboro cigarettes, announced that it would be cutting ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!