For a married couple, the capital gains tax incentive when selling their home after 2 years is up to?

When a married couple sells their primary residence and meets certain criteria, they may qualify for a significant capital gains tax exclusion. This incentive allows them to exclude up to $500,000 of capital gains from the sale of their home if they have lived in the house for at least two years within the five-year period before the sale.

This exclusion is designed to provide financial relief to homeowners by allowing them to keep more of their profits when selling their home, a beneficial aspect of the tax code intended to encourage homeownership. To qualify for this amount, the couple must file jointly, and both individuals must meet the ownership and use test, where at least one spouse must have lived in the home for two out of the last five years.

In contrast, individual sellers, or single taxpayers, are capped at a $250,000 exclusion. Understanding these figures is crucial for planning and maximizing potential tax savings when selling real estate.