701 May 2026

: If your spouse passed away, you may still qualify for the full $500,000 exclusion if the sale occurs within two years of their death and other criteria are met.

This is a complete exclusion, meaning you don't even have to reinvest the money into a new house to keep the profit tax-free. Core Requirements for the Benefit : If your spouse passed away, you may

: If your profit exceeds the exclusion limits, you can often reduce your taxable gain by adding the cost of major home improvements (like a new roof or kitchen remodel) to your "cost basis". The centerpiece of Topic 701 is the ,

The centerpiece of Topic 701 is the , which allows homeowners to sell their primary residence and exclude a massive portion of their profit from federal income tax: Single Filers : Can exclude up to $250,000 of capital gains. 000 of capital gains.