principal residence

Main Home

The place where one lives most of the time. The main home is important to persons who own multiple properties because vacation homes and investment properties are taxed differently than the main home. In particular, one is not required to pay capital gains tax on the sale of a main home, provided one then buys another main home of equal or greater value. A main home is also called a principal residence.

principal residence

The place one declares as his or her primary domicile;the address used on a driver's license,for voting,and for income taxes.The choice of a principal residence can make a difference regarding liability for income taxes, estate taxes, creditors' rights, homestead exemptions, and other such legal and economic consequences.

Principal Residence

A principal residence is generally the home in which a taxoayer lives most of the time. A taxpayer who sells a principal residence that he or she owned and lived in for at least two years in the five-year period ending on the date of sale may be able to exclude up to $250,000 ($500,000 on a joint return if both spouses used the home as a principal residence for the required time) of gain from the sale. A taxpayer can have only one principal residence at any time. A principal residence can be a home, condominium, cooperative apartment, townhouse, mobile home, or houseboat.
References in periodicals archive ?
A principal residence is where someone lives most of the year, pays their bills, cooks their meals and receives government mail.
Affirming a Tax Court decision, the Eighth Circuit held that a taxpayer who repossessed his former principal residence after the buyer defaulted had to recognize gain equal to the excess of the cash received over the previously recognized gain.
So, when a family sells one residence and acquires a new one, they can designate the property sold as their principal residence for all years prior to the year of sale, and the entire gain will be exempt from taxation.
In this case, the taxpayer purchased run-down property at a depressed rate and used it as his principal residence during development.
SENATOR PATRICK BRAZEAU IS again making headlines for all the wrong reasons, this time over the annual $20,000 housing allowance for claiming his principal residence is in Maniwaki, Que.
108(a)(1)(E) excludes from gross income qualified principal residence indebtedness discharged after 2006 and before January 1, 2013.
For the exclusion to be available during the five-year period ending on the date of the sale or exchange, the property must have been owed and used as a principal residence for periods aggregating two years or more.
6: A taxpayer who converted a principal residence to rental use may use the principal residence exclusion for COD income.
5 kW of power capacity, through 2016 (for your existing "principal residence" or new construction that will be your principal residence, DOES NOT include vacation homes) for Fuel Cells.
To qualify for this exclusion, the taxpayer must have owned and used the property as the principal residence for periods aggregating two or more years during the five-year period ending on the date of the sale.
In addition, existing homeowners who purchase a replacement principal residence can claim a homebuyer credit of up to $6,500.
Under UK tax rules, if a person owns more than one property, they have to declare which is their principal residence for tax purposes.

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