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Article: Maximizing gain exclusion/deferral when selling a principal residence due to death, divorce or marriage.
- Article from:
- The Tax Adviser
- Article date:
- February 1, 1997
- Author:
CopyrightCOPYRIGHT 1997 American Institute of CPA's. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Is a client about to sell a home due to a death, divorce or marriage? The thicket of rules regarding Sec. 1034 gain deferral and Sec. 121 one" time gain exclusion are complex and require careful scrutiny. This article examines a number of presale planning techniques available in determining which election(s) should be made to maximize gain exclusion and/or deferral.
Society has experienced dramatic changes over the past several decades. For example, in 1970, only 6.2% of women and 9.4% of men in the U.S. were single at age 30; by 1994, those numbers had risen to 18.8% and 29.4%, respectively.(1) The 1994 divorce rate was more than double the 1960 rate.(2) Between ...