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Sell your main home and a big piece of the gain can be tax-free: up to $250,000 single, $500,000 married — if you owned and lived there two of the last five years. Past the exclusion, or on any property that doesn't qualify, you pay 0, 15, or 20% after a year, or your ordinary rate inside a year.
The capital gains tax on a real estate sale depends on one question: was it your main home? That single fact decides whether a large slice of the gain is tax-free or fully taxable, and online calculators skip it. The home-sale exclusion (per IRS Publication 523) is the single biggest break in real estate tax, and it's the first thing we check.
Gain above the exclusion cap is still taxable. And the exclusion only covers a home you lived in, so a long-held, highly appreciated home can still leave a taxable gain after the exclusion is applied. That's when basis reconstruction and rate-band planning start to matter.
The single biggest break in real estate tax. Get this right first, then everything else.
Own the home AND live in it as your main home for at least 2 of the 5 years before selling. Meet both tests and up to $250k of gain is excluded ($500k if you file jointly and both spouses meet the use test). The 2 years don't have to be continuous.
The exclusion can be used once every two years — not more. If you sold another main home in the last 2 years and took the exclusion, this sale doesn't qualify (unless a partial-exclusion trigger applies).
A work move (50+ miles), health issue, or other unforeseen event that forces an early sale unlocks a partial exclusion — prorated by the fraction of the 2-year window you met. Even 6 months in the home can qualify for a quarter of the exclusion.
If any part of the home was ever rented (Airbnb'd, converted to a rental, or used as a home office you depreciated), the depreciation taken is recaptured at up to 25% — separate from and BEFORE the capital-gain exclusion. See capital gains tax on investment property for the recapture-heavy scenario.
Held more than a year, the gain is long-term — 0, 15, or 20% for 2026. Held a year or less, it's taxed as ordinary income (much higher). One day matters here — closing date vs anniversary date.
The gain stacks on your other income, so the same gain can fall partly in the 15% band and partly in 20%. Higher earners also add 3.8% NIIT surtax on the investment income portion.
Depreciation taken while it was a rental (even a home office deduction) is recaptured at up to 25%, separate from the rest of the gain. See capital gains tax planning for the whole framework.
The exclusion catches most of the gain for most sellers. The rest comes down to basis reconstruction — the improvements you made, the closing costs, the selling expenses. Owners who never tracked a new roof, an addition, or a renovation routinely overstate their gain and overpay.
Your fee depends on the work involved, not hours billed. Three things move it: how the property was used (pure primary residence, part-rental, or convert-back); how many years of basis we rebuild; whether more than one state taxed the gain.
To get a quote, tell us what you paid, how the property was used, and what it sold for. The fee comes back in writing before any work begins.
Your taxable gain is sale price − adjusted basis. Basis is NOT just what you paid — it includes capital improvements and many closing/selling costs. Rebuilding basis before filing often lowers the tax bill more than anything else. What counts and what doesn't:
Sources: IRS Publication 523 (home-sale exclusion + basis rules); Topic 409 (capital gains rates); Topic 701 (main-home use test)
A good fit if:
Not your main home? See capital gains tax on second home or capital gains tax on investment property. Inherited? capital gains tax on inherited property covers the stepped-up basis. Or the full framework at capital gains tax planning.
Four inputs decide it: what you paid, what it sold for, how the property was used, and the improvement records you kept. From those we give you the taxable gain, the exclusions that actually apply, and the rate on each slice.
"Taxpayers approach us after doing their taxes in TurboTax or on H&R Block or a do-it-yourself app, and they have a huge tax bill and they don't know why they have it."
— George Dimov, CPA, Founder of Dimov Tax
The aim is the smallest defensible number. Confidential CPA review — not a call center.
