New York State Real Estate Salesperson Licensing Exam

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the New York State Real Estate Salesperson Licensing Exam. Learn with flashcards and multiple choice questions, each question includes hints and explanations. Be confident and ready for your exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

How much profit can a single person claim tax-free from the sale of a personal residence?

$250,000
$500,000
$100,000
$1,000,000

The correct answer is: $250,000

A single person can claim a tax-free profit of up to $250,000 from the sale of their personal residence, as stipulated by the Internal Revenue Service (IRS). This exemption is part of the capital gains tax provisions that allow homeowners to exclude a certain amount of profit when selling their home, provided they meet specific requirements. To qualify for this exclusion, the seller must have owned and lived in the home as their primary residence for at least two of the five years preceding the sale. This tax benefit is intended to encourage homeownership and to provide some financial relief for individuals selling their homes. While married couples can exclude up to $500,000 of profit if filing jointly, the amount for single filers remains at $250,000. Other figures, such as $100,000 or $500,000, do not apply to an individual selling their personal residence in the context of personal use property, aligning with federal tax laws that govern capital gains on residential property sales.