Publication 523 - Introductory Material


Key Points

This publication explains the tax rules that apply when you sell (or otherwise give up ownership of) a home. It also shows you how to do the calculations you'll need to do.

If you sell your home at a significant profit (gain), some or all of that gain could be taxable. However, in most cases, if the home you sold counts as your main home, the first $250,000 of gain is not taxable—$500,000 if you are married and filing jointly.

If you sell your home at a loss, the money you receive is not taxable. However, you cannot deduct the loss from other income.

This publication will show you how to determine if you have a gain or loss, how much of that gain is taxable (if any), and how to report your transaction correctly.

Staying Current

To be sure you have the most up-to-date information related to Publication 523, such as legislation enacted after it was published, go to www.irs.gov/pub523.

Related IRS Materials

You may find the following publications, forms, and instructions helpful when you are working through this publication.

Useful Items - You may want to see:

Publication

  • 504 Divorced or Separated Individuals

  • 505 Tax Withholding and Estimated Tax

  • 527 Residential Rental Property

  • 530 Tax Information for Homeowners

  • 537 Installment Sales

  • 544 Sales and Other Dispositions of Assets

  • 547 Casualties, Disasters, and Thefts

  • 551 Basis of Assets

  • 587 Business Use of Your Home

  • 936 Home Mortgage Interest Deduction

  • 4681 Canceled Debts, Foreclosures, Repossessions, and Abandonments

Form (and Instructions)

  • Schedule A (Form 1040) Itemized Deductions

  • Schedule B (Form 1040A or 1040) Interest and Ordinary Dividends

  • Schedule D (Form 1040) Capital Gains and Losses

  • 982 Reduction of Tax Attributes Due to Discharge of Indebtedness

  • 1040 U.S. Individual Income Tax Return

  • 1099-S Proceeds From Real Estate Transactions

  • 4797 Sales of Business Property

  • 5405 Repayment of the First-Time Homebuyer Credit

  • 6252 Installment Sale Income

  • 8822 Change of Address

  • 8828 Recapture of Federal Mortgage Subsidy

  • 8949 Sales and Other Dispositions of Capital Assets

  • W-2 Wage and Tax Statement

  • W-7 Application for IRS Individual Taxpayer Identification Number


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