Capital Gains Exclusion: 2 year between primary sales?

[Shane Johnson]

I owned two homes until recently. I bought the first 4 years ago, sold 3 weeks ago. I bought the second 15 months ago. By selling the first house only 3 weeks ago, did I just reset the clock by 15 months until I can claim the cap gains exclusion on my current home? Or am I reading this wrong?

Maximum Exclusion

You can exclude up to $250,000 of the gain (other than gain allocated to periods of non-qualified use) on the sale of your main home if all of the following are true.

• You meet the ownership test.
• You meet the use test.
• During the 2-year period ending on the date of the sale, you did not exclude gain from the sale of another home.

So, my thoughts now are, If I find a great property, rent my current house out,(1 year min?) in order to qualify it for a 1031? Or else I would have to wait the 2 years to avoid the cap gains, and hope the market is as strong as it is now...

Thoughts or opinions on that?

[Wayne Brooks]

The most important part, you may be missing is, the home must be your primary residence for at least two of the last 5 years, not simply owning it for 2, or 22, years.