Do You Pay Capital Gains Tax When You Sell Your Home in Florida? Section 121 Explained

Florida does not tax the gain on your home sale, so the real question is federal: how much of your gain does section 121 exclude, and what happens to the rest? This post explains the $250,000 and $500,000 limits, the 2-of-5-year tests, partial exclusions, rental time and depreciation, the 2026 rates and the 3.8 percent tax, with a worked example you can redo using your own closing statements.