No one at that time could imagine the boom we had last year. But this year home sellers will begin to see the fruits of that law when they prepare and file their 1999 income tax returns. The 1997 tax law abolished both of these concepts for sales that took place after May 6, 1997. Now there is a simpler and more liberal approach to calculating gain on the profit you have made as a homeowner. If you are married, so long as either spouse meets this requirement, the exclusion of gain applies.
Marital status is determined on the date the house is sold.
In the event of a divorce where one spouse is given ownership pursuant to a divorce decree or separation agreement, the use requirements will include any time that the former spouse actually owned the property before the transfer to the other spouse. The exclusion is generally applicable once every two years. Most homeowners who are required to sell their home within less than two years probably will not be fortunate enough to have made sufficient profit to be concerned about this issue. If your boat or your mobile home is your principal residence, the law also applies. The old rollover rules were mandatory.