Sold A Home Last Year? Here's What To Know For Tax Time.

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There are some specific exceptions, such as for military filers and for properties that are damaged. And if you own the home for less than a year, you don't qualify for the exclusion. If you have any questions, it might be best to consult a tax professional for those situations.

Hopefully you've been keeping good records of the upgrades you've made to your home over the years. Those costs can help reduce what you owe when you sell. "The way I think about it is anything you can take off the wall is not a capital improvement, but anything that is fixed there is," Spencer says.

If you need a little more guidance, Spencer says IRS Publication 523 is a helpful, plain-English list of things to understand. And if you think your situation is more complicated than that, you probably want to enlist a professional.

In most cases, that amount would have been determined at the time the estate was settled, ideally with a qualified appraisal, Tullio says.