If we are nearing 3 years trying to sell our primary residence, can we go past 3 years and not lose the federal tax exemption?

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If we are nearing 3 years trying to sell our primary residence, can we go past 3 years and not lose the federal tax exemption?

We’re in a tough market. We moved and have been trying to sell our primary residence for 3 years. We had 2 separate back to back purchase option fall apart. Since them its been on the market for 8 months. We got an apprasial done 4 months ago and marketed it at the appraised valus and have since dropped below that. so we are not being unrealistic. The problem is only the lower end of the market stabilized and the buyers just aren’t our there. I just need to know if there is any case law that allows us some more time to market the house or do we have to fire sale it?

Asked on May 17, 2012 under Real Estate Law, Florida

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

I do not understand what federal tax exemption that you have written about that has a three year time period to be implemented or it is lost. If you are talking about the the amount of gain that one can have on the sale of his principal residence on a sale tax free up to $250,000 per individual and $500,000 per couple, such would not be at risk.

I suggest that you consult with a tax attorney further as to the specifics of your question and the desire to sell your main residence.


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