Will you owe tax on the sale of your home?

For most owner-occupants, the answer is $0 — and this checker shows why, step by step. Federal law (Internal Revenue Code §121) excludes up to $250,000 of gain if you're single, or $500,000 if married filing jointly, when you've owned the home and lived in it for at least 2 of the 5 years before the sale (IRS Topic No. 701). Worked example below: a $211,000 gain, fully excluded, taxable gain $0.

Capital Gains & §121 Exclusion Checker

Answer in purchase order: what you paid, what you put in, what you'll sell for. Results update as you type.

Original purchase price ($)

Purchase closing costs ($) Settlement charges that count toward basis (not prepaid interest or taxes).

Major improvements, total ($) Roof, addition, HVAC, remodels. Routine repairs don't count.

Sale price ($)

Selling costs ($) Commissions plus closing costs, in dollars.

Filing status

Owned it at least 2 of the last 5 years?

Lived in it as your main home 2 of the last 5 years?

Your capital-gains bracket (estimate) Simplified federal long-term rates — pick the one closest to your income.

Your gain, step by step

Your basis (paid + purchase costs + improvements)	$0
Amount realized (sale price − selling costs)	$0
Gain on the sale	$0
§121 exclusion	$0
Taxable gain	$0

Estimated federal capital-gains tax

This is an estimate, not tax advice. The real calculation depends on your total income, state taxes, and possibly the 3.8% net investment income tax — none of which are included here. Confirm your numbers with a tax professional before you sell.

The steps, in plain English

Basis is your starting line: what you paid, plus most purchase closing costs, plus major improvements over the years (IRS Publication 523 lists what counts). Amount realized is the sale price minus selling costs. The difference is your gain — and only the part of the gain above your exclusion is taxable, at long-term capital-gains rates that depend on your total income.

The default example, figured: bought for $300,000, no purchase costs added, $50,000 of improvements → basis $350,000. Sell for $600,000 with $39,000 of selling costs → amount realized $561,000 → gain $211,000. Single with both 2-of-5-year tests passed: exclusion $250,000 covers it all → taxable gain $0. Fail the tests and the same sale has a $211,000 taxable gain. Married filing jointly: the $500,000 exclusion covers it either way.

Planning to sell? Feed the tax estimate into the net proceeds calculator, or run the full three-way comparison in the stay-or-sell decider. Deeper detail: The $250,000/$500,000 home-sale exclusion, explained.

Questions, answered straight

What is the $250,000 / $500,000 home-sale exclusion?

Section 121 of the tax code lets you exclude up to $250,000 of gain on the sale of your main home if you are single, or $500,000 if married filing jointly — provided you owned the home and lived in it for at least 2 of the 5 years before the sale. (Source: IRS Topic No. 701.)

What is my basis?

Generally what you paid for the home, plus most purchase closing costs, plus the cost of major improvements — a roof, an addition, a new HVAC system. Routine repairs and maintenance do not raise your basis. (Source: IRS Publication 523.)

What if I don't meet the 2-of-5-year tests?

Then the exclusion is generally $0 and the whole gain is taxable — though partial exclusions exist for sales caused by a job change, health reasons, or certain unforeseen circumstances. A tax professional can tell you whether one applies to you.

Is this tax advice?

No. This checker is a simplified federal estimate using the 0%, 15%, or 20% long-term capital-gains bracket you select. State taxes, the possible 3.8% net investment income tax, and your exact income picture are not included.