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. 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 >>
  2. Will I pay capital gains tax on the profits from the sale of my home?

    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 >>
  3. Is it possible to make my primary residence in FL (I currently live in NY) if I have ...

  4. 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 >>
  5. How do I calculate the capital gains tax on the sale of my house?

    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 >>
  6. 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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