Over-55 Home Sale Exemption

What is the 'Over-55 Home Sale Exemption'

The over-55 home sale exemption is an obsolete tax law that provided homeowners over the age of 55 with a one-time capital gains exclusion. Individuals who met the necessary requirements could exclude up to $125,000 of capital gains on the sale of their personal residences. The exclusion was intended to stimulate the real estate market and reward homeowners for their purchase and subsequent sale.

BREAKING DOWN 'Over-55 Home Sale Exemption'

The over-55 home sale exemption was superceded by provisions in the 1997 Tax Reform Act. This act raised the amount of excludable gain to $250,000 per taxpayer, and also allowed for more than one exclusion per taxpayer per lifetime.

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RELATED FAQS
  1. Is there a home tax exemption for my deceased spouse?

    I have to sell my home. I understand the $250,000 tax exemption. My wife recently passed away. Can I retain her tax exemption?  ... Read Answer >>
  2. Can I take another exclusion in 2016 for selling my current condo?

    I sold one house in May 2012 and made about $100,000 and put it down on a condo on June 1, 2012. I have lived in the condo ... Read Answer >>
  3. Will we need to pay capital gains tax on our home that we owned for less than a year?

    We are in Texas. We bought a house 10 months ago with a sales price of $255K. We put a down payment of $75K on it. We ... Read Answer >>
  4. Do I have to pay capital gains tax if I invest my equity into a new home?

    I have owned and lived in my home for 14 months. I want to sell it and move into a bigger home. Can I invest my equity into ... Read Answer >>
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    I am single and have lived in my house for 30 years. Does it make a difference if I rent or buy after selling the house? ... Read Answer >>
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    I'm thinking of selling my first house, but I just learned that I might have to pay capital gains taxes. I wanted to use ... Read Answer >>
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