Singles don't have to pay taxes on up to $250,000 in profits on the sale of their home, and couples can shelter twice that amount from taxes. But even if the gain is much higher, there are ways for home sellers to minimize the tax bite. Getty Images By Kimberly Lankford, Contributing Editor April 20, 2018 QI'm thinking about selling my house and then renting for a while. Will I have to pay higher capital gains taxes on my home sale because I'm not rolling over the money to a new house?ANo. You're thinking of the old law, under which people could delay paying taxes on their home-sale profits if they rolled over their gains into the purchase of a new house. But the rule changed in 1997 and now lets people exclude a big portion of their home-sale profits from taxes, whether or not they buy a new house. SEE ALSO: How Smart a Home Seller Are You? The specifics depend on how long you've owned the house and your tax-filing status. You can exclude from taxes up to $500,000 in gains on the sale of your home if you're married filing jointly (or up to $250,000 if you're single), as long as you've lived in the house for at least two out of the past five years. So, for example, if you're married and bought a house several years ago for $300,000 and then sell it for $700,000, you won't have to pay taxes on the $400,000 in profit. If your profits are higher than the threshold, there are still ways to minimize the taxes. To calculate the size of your profit, take the sales price of the house (minus certain expenses, such as an agent's commission and any points you paid for the buyer) and subtract the adjusted tax basis, which is the original cost of the home plus certain settlement fees or closing costs you paid. You can also add to the basis the cost of major home improvements, such as a new roof; a remodeled kitchen; the addition of a room, deck or porch; or a new heating and air conditioning system. (Basic repairs and maintenance don't count.) Keep records of the cost of the improvements until three years after you sell your house. See When It's Safe to Shred Your Tax Records for more information. Advertisement If you haven't lived in the house for two of the past five years, you may still be able to exclude part of your gains from taxes if your move was prompted by changes related to work, family or health. These include a divorce, death of a spouse, the birth of two or more children from a single pregnancy, the need to obtain or provide health care, and a new job that is at least 50 miles farther from home than your old work location. See IRS Publication 523, Selling Your Home, for more information about the calculation. SEE ALSO: 12 Things Home Buyers Hate Most About Your House Got a question? Ask Kim at firstname.lastname@example.org.