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Joyce is a widowed taxpayer whose husband Willard passed away on March 31, 2020. Joyce and Willard had purchased a home for $215,000 on September 12, 2004, lived in the home as their main home until Willard’s death. Joyce moved in with her daughter after Willard’s death, and sold the home on November 30, 2020, for $595,000. How much of the gain on the sale can Joyce exclude from taxable income?

Sagot :

anthougo

The amount of the gain that Joyce can exclude from her taxable income is $380,000, with a maximum of $500,000.

Data and Calculations:

Cost of home purchased on September 12, 2004 = $215,000

Proceeds from the sale of the home on November 30, 2020 = $595,000

Capital gains = $380,000 ($595,000 - $215,000)

The maximum amount for exclusion from income = $500,000

Thus, Joyce can exclude $380,000 from the gain because she sold the home in the same tax year as her husband's death, which qualifies her to exclude the maximum amount of $500,000.

Learn more: https://brainly.com/question/25815397

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