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Unmarried Couples and Taxes

What are the tax implications for an unmarried couple who sell a house? We've lived in the house for more than 20 years and never rented it out. We've split the mortgage, property-tax bill and income-tax deduction.

If you're both listed on the title, you each can exclude up to $250,000 of your profits from capital-gains taxes. That's the amount single individuals can exclude if they've lived in a house for at least two out of the past five years.

If you own the house jointly and sell it for $400,000 more than you paid for it, for example, you'll each have $200,000 in profits -- well within the $250,000 capital-gains exclusion. If you sell the house for a $600,000 profit, you'll each owe tax on the $50,000 gain.

For more information about the tax rules for home-sale profits, see IRS Publication 523 Selling Your Home.

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