home owner's exclusion problem

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  • #1657144
    Kairos
    Participant

    I know im clearly missing something really simple here but why is the answer C and not A? The explanation is that the 2 year time requirement is met by John but not by Karen but if im seeing things correctly, on the date Karen moved into the house june 10 year 4 and the date they left, Oct 15 year 6 meets the 2 year requirement no?

    John purchased a primary residence on Oct 15 year 2 for $240,000. On june 10 year 4 he married karen and she moved into the house. Karen was not added to the deed. On Oct 15, year 6 they moved out of the house. John sold the home on Oct 15, year 7 for 850,000. what amount of gain from the sale is recognized on their year 7 joint income tax return.

    a) 110,000
    b) 122,000
    c) 360,000
    d) 610,000

    answer C

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