I am looking for 2 things but mainly regarding my home sale. I apologize in advance if I am long winded but here is my situation: I moved in December 2004 to a small 3 bedroom (2 bedroom + den/office) that backed onto a golf course. The house was for myself and girlfriend at the time we purchased although we were engaged within 2 weeks of moving in. Everything was nice with the house but by late winter / early spring 2005 my wife stated to get pretty bad seasonal allergies that she hadn't every really had before. She got by ok with over the counter medications like clariton and the like. Anyway long story short we got married later in 2005 but with no plans for children for at least a year or more beyond that. However as fate would have it even though we were not trying too we became pregnant late last year just shortly after getting married. As much as it's early and we were/are not quite 'ready' we are very happy and looking forward to our new addition. In any case the pregnancy was going ok but the allergies started up to the point she thought she was sick at first. She was not sleeping well, having throat soreness, itchy eyes and all of that but could not take any medication as we were recommended to avoid it. It was causing stress for the pregnancy and she started opting to spend weekends at her parents for relief as it's particularly worse for her during the day times after they run the mowers on the course and kick up all of the stuff in the air. She tends to be fine at her parents only a few miles away and spent most of her spring break there as well. Long term we realized we needed to move either way and with the need for her to stay home to care for the baby being stuck in a house where she has bad allergies would be bad enough. Also to breast feed they still say not to take most medications. She is a Grade 1 teacher and completes her year to stay at home with the baby in May so we started looking around and checking the market to see what we could get into. With the market surge here recently everything had gone up but we found something that was just perfect for us and priced to sell at exactly the same price as what our current house was valued. It's a slightly larger 4 bedroom sans the golf course only a few miles away in a nearby neighborhood to her parents. So we put in a conditional offer on the sale of our house and listed our house for sale. Before we had time to even think about it our house sold in just 2 days. The problem now is that the appreciation we show on the sale is about $90,000. When I went into this I knew we were inside of 2 years but thought we still had the rights to do a wash between the houses and not deal with taxes since we are staying invested in exactly the same value and not actually realizing any net gains. However I've now learned late in the game that the rules which changed a while back to allow the gains to be realized every 2 years tax free, also essentially prohibit selling inside of 2 years even if you reinvest 100%. I guess it's not quite accurate to say 'prohibit' but it kind of seems like it when you just move for a change in life situation and not for a net profit. So here I am I have this deal gone through and I've discovered that the rules aren't as I thought. I've now spent the last 2 days researching as much as I can and read up on the reduced maximum exclusion. It seems the intent for this somewhat matches my circumstances in that we discovered the house we moved into was no longer suitable for us due to several unforeseen circumstances. However nothing that my situation really matches any of the list of scenarios that they outlined in the pub 523 document. I also found another document that has a bunch of scenarios but still leaves me unsure. Here are the links that I am referring to:
Dean.
P.S. I mentioned I was looking for 1 other thing and that is a good tax advisor to work with. I don't have tons of money and investments to manage but I would like to have someone for tax preparation and for any questions like this when they come up. Does anyone have any suggestions for someone in the Phoenix area?