One Gain, One Loss, Do They Offset?

[Todd Magin]

A friend wants to sell two homes, neither of which he can claim as his primary residence. One property he will likely have a $120k gain on. The other will likely sell for a $60k loss. If he sells them in the same year, does he only pay capital gains on the difference? If the sales occur in separate years, what happens? Capital gain in one year and capital loss in the other year?