Renting a Three Bed, Two Bath Ranch Style Home

If you live in a property for at least two years and then rent it out, you can exclude up to 500 k cap gains. If you sell three years in one day after that date, you do not qualify for the Section 121 exclusion. It's really important to understand because if you're looking at offsetting a $500,000 capital gain and you're in the highest tax bracket, you're talking about $110 or so $1000 in taxes. We have clients that do this. It's kind of like a unique version of house hacking, if that makes sense.

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