Move back to duplex to save taxes?

[Bruce Reeves]

Just knocking this idea around and have a few questions.

I have a duplex with tenants and in the next few years would really like to exit the landlord arena. I've been renting the duplex for 22 yrs and it will be paid off in three years. I've put my capital gain and depreciation recapture tax in my Excel spreadsheet, and as we all know, it ain't pretty.

About 55k in taxes. Not interested in 1031exch, etc. Annual rent for both sides combined would be about 22k.

If I moved back for years 2024/2025 for two years occupying both sides, any reason I can't sell tax free? I did sell my primary residence in 2020 tax free, so I will be past that two year exclusion threshold. Currently renting a house.

My thinking is, the tax savings makes up for the lost rent and then some and no tenants or repair/maintenance other than what I choose to do.

Can I occupy both sides per the IRS for primary residence? I will be doing that, so not trying to slide anything under the table.

Thanks for any advice.