I know this question has been answered as far as the two year rule but I haven’t seen a mention of the look back requirement.
My fiancee and I are planning on selling our home and will be taking a profit. We’ve only lived here a little over a year, however due to how crazy the housing market is rn we’re afraid we are no longer going to be able to afford it.
We would be taxed for any profit we make on the house since we haven’t lived her two years, however I read about the look-back requirement and I’m not sure if I fully understand it.
“If you didn’t sell another home during the two year period before the date of sale, you meet the look-back requirement. You may take the exclusion only once during a 2-year period.”
Am I correct in assuming this means if we haven’t sold a house in the time we’ve lived here, we are eligible for an exclusion on gain taxes?