Primary Residence / Capital Gains Questions

[Ryan Kinsella]

Hello Everyone,

I have a friend selling his primary residence a little sooner than anticipated and wondered if anyone had come across capital gain tax issues in the past.  Here are the facts:

- Closing date for current primary is end of May and will be a total of 22 months lived in and owned.

- Purchase price was $525k

- Sale $1,025,000

- Improvements- I think he could come up with $350k or so.  Complete gut plus added pool/ect.

- Paying 6% closing costs

- New primary residence he is purchasing will be closing same day at $1,150,000

Thoughts/ Ideas?