Principal Residence

AAA

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.

INVESTOPEDIA EXPLAINS '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.

RELATED TERMS
  1. Qualified Personal Residence Trust ...

    A specific type of trust that allows its creator to remove a ...
  2. IRS Publication 523

    A document published by the Internal Revenue Service (IRS) that ...
  3. Foreign Housing Exclusion And Deduction

    An allowance for taxpayers who live and work in a foreign country ...
  4. Deferred Gain On Sale Of Home

    An obsolete tax law that applied to homeowners before May 7, ...
  5. Capital Gain

    1. An increase in the value of a capital asset (investment or ...
  6. Vacation Home

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

    10 Sources Of Nontaxable Income

    Taxes are often a deterrent from investing and saving. These financial practices will bring you no tax grief.
  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

    Will Your Home Sale Leave You With Tax Shock?

    Learn how the newest tax laws apply to the proceeds you earn.
  4. Budgeting

    Get Through Divorce With Your Finances Intact

    Find out how to split your finances without coming up short.
  5. Home & Auto

    Mortgage Fraud: Understanding And Avoiding It

    There are many different ways to be victimized through home ownership - learn how to identify and avoid these crimes.
  6. Options & Futures

    Things To Know About The Home Modification Plan

    This program allows FHA borrowers to reduce monthly mortgage payments through negotiation with lenders.
  7. Taxes

    Avoid Capital Gains Tax On Your Home Sale

    If you have property to sell and want to avoid capital gains tax, a Section 1031 exchange may be the answer.
  8. 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.
  9. Personal Finance

    Creating A Tax-Deductible Canadian Mortgage

    Find out how to get a tax benefit from your mortgage like your neighbours to the south.
  10. Home & Auto

    Strategic Bathroom Enhancements With Huge Returns

    Even modest investments to improve a small bathroom can yield considerable rewards.

You May Also Like

Hot Definitions
  1. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
  2. Asset Class

    A group of securities that exhibit similar characteristics, behave similarly in the marketplace, and are subject to the same ...
  3. Fiat Money

    Currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat ...
  4. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  5. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  6. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
Trading Center