Jason and Alicia Johnston Purchased a Home in Austin, Texas

question 60

Essay

Jason and Alicia Johnston purchased a home in Austin, Texas, for $500,000. They moved into the home on September 1, year 0. They lived in the home as their primary residence until July 1 of year 5, when they sold the home for $800,000. What amount of the $300,000 gain are they allowed to exclude? (Assume married filing jointly.)

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Definitions:

Priced

Determined the monetary value of a product, service, or asset.

Cereal

A food product made from processed grains, typically eaten as a breakfast food, often fortified with vitamins.

Percent Change

The measure of the degree of change over time, calculated as the difference from the original value to the new value, divided by the original value, multiplied by 100.

Per-Kilometre Charge

A fee assessed based on the distance travelled, often used in contexts such as delivery services, transportation, or car rentals.