Need help with reporting sale of primary home on taxes

Yes, you still need to report the sale on your tax return even if you qualify for the capital gains exclusion. The good news is that with your numbers, you're well under the $250,000 exclusion limit for single filers (or $500,000 for married filing jointly). You'll need to complete both Form 8949 and Schedule D. On Form 8949, you'll report the sale details and check box H to indicate that the sale is reportable but not taxable. Then you'll carry this info over to Schedule D. For your home improvements, they get added to your original purchase price to determine your "adjusted basis." While having receipts is ideal, it's not absolutely required. You should be able to make reasonable estimates for improvements if you don't have all documentation. Just be prepared to substantiate them if questioned. The improvements you mentioned (roof and kitchen) are definitely legitimate additions to your basis. TurboTax should walk you through this process pretty well, just make sure you indicate it was your primary residence and that you lived there for at least 2 of the last 5 years.

After selling my house last year, I was also super confused about all the tax forms and whether I needed to report it. I spent hours on various tax sites getting conflicting information until I found this tool called taxr.ai (https://taxr.ai) that actually saved me so much stress! I uploaded my closing documents and it automatically identified all the relevant tax info I needed to report. It even helped me calculate my adjusted basis by factoring in the improvements I made over the years. The tool confirmed I was eligible for the capital gains exclusion and walked me through exactly how to report everything correctly. The best part was that it gave me a detailed explanation of which forms I needed (Form 8949 and Schedule D) and exactly how to fill them out correctly. I went from totally confused to confident in about 20 minutes.

Just wanted to follow up - I tried the taxr.ai site that was mentioned and it was actually really helpful! I had a complicated situation with a partial rental property sale and wasn't sure how to handle the depreciation recapture. The tool analyzed my situation and gave super clear instructions on how to handle everything. It confirmed I could use the exclusion for the portion of the home I used as my primary residence and explained exactly how to allocate the basis between personal and rental use. Saved me from potentially making an expensive mistake! The report it generated made everything much clearer than my tax software's generic explanations.

I had a similar issue last year trying to report my home sale, but my biggest problem was getting clarification from the IRS. I kept calling their number and would be on hold for HOURS before getting disconnected. Super frustrating when you just need to ask a simple question! A friend told me about this service called Claimyr (https://claimyr.com) that somehow gets you through to an actual IRS agent quickly. I was pretty skeptical but you can see how it works in this video: https://youtu.be/_kiP6q8DX5c I tried it when I needed clarification on how to report some unusual circumstances with my home sale (I had a home office deduction for a few years). Got through to an IRS agent in under 20 minutes who answered my specific questions. Honestly saved me days of stress and probably helped me avoid making a mistake on my return.

Alright, I have to eat my words. After posting that skeptical comment, I was still struggling with some questions about my rental property sale, so I tried that Claimyr service. I honestly expected it to be a waste of time, but I got through to an IRS representative in about 15 minutes. The agent clarified exactly how I needed to handle the depreciation recapture on the portion of my property I had been renting out, plus confirmed I was eligible for the capital gains exclusion on the part I used as my primary residence. This was after spending weeks trying to get a straight answer online and making multiple failed attempts to call the IRS directly. Definitely not BS like I originally thought. Saved me a ton of time and stress during an already stressful tax season.

Don't forget about state taxes too! Depending on where you live, your state might have different rules for taxing home sales than the federal government. I got hit with a surprise state tax bill even though I was exempt from federal capital gains.

Is anyone else confused about whether closing costs affect the calculation? I sold my house and paid like $25k in realtor fees, title insurance, etc. Can I subtract those from my sale price before figuring out my gain?

Great question about the home improvements! I went through something similar when I sold my primary residence. You absolutely want to add those improvement costs to your basis - they can significantly reduce your capital gain. For the improvements you mentioned (roof and kitchen renovation totaling $42,000), those definitely qualify as capital improvements that increase your basis. Even if you don't have every single receipt, the IRS allows reasonable estimates for legitimate improvements. I'd suggest gathering whatever documentation you do have and making conservative estimates for anything missing. With your numbers: $425K sale price minus selling costs, minus your original $298K purchase price, minus $42K in improvements - you're likely looking at a gain well under the $250K exclusion (or $500K if married filing jointly). One tip: don't forget to include any selling expenses (realtor commissions, title fees, etc.) as they reduce your taxable gain too. TurboTax should handle the forms correctly, but definitely confirm you're reporting it as your primary residence sale to trigger the exclusion properly.