Exclusion of Gain
Principal residence defined. A principal residence is your main home, which is the home where you ordinarily live most of the time. You can have only one main home at any one time.
Individual homeowners. Individuals can exclude up to $250,000 of gain on the sale of a home if three tests are satisfied.
1) Ownership. You owned the home for at least two years during the 5-year period ending on the date of sale,
2) Use. You used the home as a principal residence for at least two years during the 5-year period ending on the date of sale, and
3) Two-year period. You did not exclude gain from the sale of another home during the 2-year period ending on the date of sale.