Question

An individual taxpayer is selling her principal residence, which she has owned for ten years and lived in for nine years. What section and subsection of the Internal Revenue Code states the amount of gain the taxpayer can exclude from gross income from the sale of her principal residence

Answer 1

Answer:

Section 121 exclusion

Explanation:

In simple words, IRC section 121 requires a person to deduct up to $250,000 ($500,000 for dual filers) of profit from the selling (or exchange) of land that was purchased and utilized as a primary home for at minimum two of that five years preceding the sale. Thus, from the above explanation we can conclude that the correct answer is section 121 exclusion.