How-to · Updated August 4, 2026
How much capital gains tax on a home sale?
Direct answer
Many primary-residence sales owe $0 federal capital gains tax because of the Section 121 exclusion — up to $250,000 (single) or $500,000 (married filing jointly) of gain if you meet ownership and use tests. Tax is due on gain above that exclusion, and rentals usually do not get the same automatic break.
Worked examples (federal, educational)
| Scenario | Gain | Exclusion | Est. federal CG tax |
|---|---|---|---|
| Married MFJ primary home: $700k sale, $400k basis, $30k costs | $270,000 | $500,000 | $0 |
| Single primary home: $650k sale, $300k basis, $25k costs; remainder @ 15% | $325,000 | $250,000 | ~$11,250 on $75,000 |
| Investment/rental: $200k long-term gain, no Section 121; illustrate @ 15% | $200,000 | $0 | ~$30,000+ |
Honest limits: ignores Net Investment Income Tax (3.8%), state tax, depreciation recapture (up to 25% on prior rental depreciation), partial exclusions, and filing status edge cases. Not tax advice — confirm with IRS Pub 523 and a CPA.
Formula (simple)
- Gain ≈ sale price − selling expenses − adjusted basis
- Taxable gain ≈ max(0, gain − Section 121 exclusion)
- Federal CG tax ≈ taxable gain × your long-term rate (often 0%, 15%, or 20%)
Use the free calculator
Model exclusion, depreciation recapture, and state variants: Real estate capital gains tax calculator. Also: general capital gains.