Capital gains exclusion

Capital gains can get confusing when you have more than one property and you are looking to sell them both at the same time. There is such a thing as capital gains exclusion but this method cannot be used when you are selling at the same time. There are rules in place that prevent you or anyone else from doing this. Before you can make use of capital gains exclusion you have to have lived in the house for a certain amount of time, 2 years within the last 5 to be exact but that is not all. For instance you cannot use this exclusion more than once every two years. SO if you did want to use capital gains exclusion then you would have to wit two years until you sold your second property.

The tricky part of this situation is deciding if this is the right way to go. For instance you may save on taxes but how much could you lose in the appreciation value of the first property if you sell it? What I mean is how much money could this property have made you in the two years after you sold it? Could you have made more than you lost in paying the taxes? These are the things that you have to work out before you make your final decision.