Article Date:
August 2008


Word Count:
894

 

 

New Housing Rescue Law Destroys Vacation and Rental Home Sales Strategy


Before this new law, which takes effect on January 1, 2009, the savvy taxpayer could convert his old rental or vacation home into a principal residence, live in it for two years, and then sell it to take advantage of the $250,000 and $500,000 exclusion of gain rules.

 

Example of Old Law

 

In 1995, Jim Johnson bought a vacation home for $50,000. In 2006, when the vacation home was worth $200,000, he moved into this vacation home and made it his principal home for two years and five days. In 2008, ... Log in to view full article.

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