Can I still take the home sale gain exclusion if I move my residence from IL to CA?

The sale of your home qualifies for a gain exclusion of $250,000 ($500,000 if married filing jointly) if all of the following are met:

1. You did not claim any exclusion for the sale of a home that occurred during a 2-year period ending on the date of the sale of the home, the gain from which you now want to exclude
2. You owned the home and used it as your main home during at least 2 of the last 5 years before the date of sale
3. You did not acquire the home through a like-kind exchange (also known as a 1031 exchange), during the past 5 years

Eligibility test:

A. Ownership – the tax payer owned the home 2 out of the last 5 years

B.  Residence – determine whether you meet the residence requirement: if your home was your residence for at least 24 of the months you owned the home during the 5 years leading up to the date of sale, you meet the residence requirement.  The 24 months of residence can fall anywhere within the 5-year period. It doesn’t have to be a single block of time.  All you need is a total of 24 months (730 days) of residence during the 5-year period.