Principal Residence

DEFINITION of 'Principal Residence'

The primary location that a person inhabits. It doesn't matter whether it is a house, apartment, trailer or boat, as long as it is where you live most of the time.

BREAKING DOWN 'Principal Residence'

You can usually avoid capital gains on the sale of your principal residence, provided you buy another place of equal or greater value that is going to become your new residence.

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RELATED FAQS
  1. If I haven't realized capital gains from selling a primary residence in the last ...

    My husband and I owned a home, sold it in 2013, and now we are considering buying a home but are uncertain of whether we ... Read Answer >>
  2. Do we have to pay capital gains tax on the sale of our property?

    We owned our primary residence for 3 years and recently sold it.  ... Read Answer >>
  3. Is it possible to make my primary residence in FL (I currently live in NY) if I have ...

  4. Do I have to pay capital gains tax when I sell my home?

    My husband and I were divorced in 2011. We owned our house jointly and he lived there after the divorce until his death in ... Read Answer >>
  5. Do we pay capital gains taxes on the profit if we sell the house?

    We have lived in our house in Washington state for 4.5 years, but we have only owned it for 1 year. ... Read Answer >>
  6. Is it true that you can sell your home and not pay capital gains tax?

    It is true in most cases. When you sell your home, the capital gains on the sale are exempt from capital gains tax. Based ... Read Answer >>
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