Capital gains on home sale

[ron.p]

Tax question really if you have any advice or can point me in the right direction (besides hiring a tax attorney).

 

We are selling our home for $60,000 more than we paid for it 22 months ago for a home we are building. The builder will not move out the closing on the new home so I can be in this home 24 months. With that, I do not meet the time test (24 months) to exclude my profit from capital gains. How can I get out of paying it? If I pay it, my cash for the downpayment is used and puts me out of qualification. Pub 523 from the IRS states I can qualify for a reduced exclusion based upon

 

1. Moving for work more than 50 miles (Doesn't help me)

2. Health (Doesn't help me)

3. Unforeseeable circumstances which can help based upon some broad terms. I think I can squeeze in there for a number of reasons.

 

If I qualify for the exclusion or reduced exclusion, pub 523 states not to report the sale of the home on my taxes meaning I do not have to state "why" I think I fit in the exclusion terms. Will they come back and ask? Is there a mechanism for them to automatically ask? Am I making a mound out of a mole hill? Thanks for any advice!

[Hideous]

i can't answer the tax part, but why won't the builder move out the date 60 days ?

 

i mean if you got a locked loan rate and the right papers signed whats for him to lose ?

 

can you pay 2 months worth of mortgage payments on the new place while you still live in the old ?

 

i have looked at a few houses for sale that people need to stay in to make the 2 years. so they ssell now but you move in in 2 or 3 months.

[ron.p]

Unfortunately, no on all counts. They won't move out 60 days and I will not qualify to close on the new house without selling the old house nor will I qualify for a bridge loan because I cannot afford to make 2 payments.