I stumble upon this word from Realtown website. I found this useful and so I wanted to have this posted on my blog for those who are looking for the definition of this real estate term. This is just a quick post.
Principal Residence
A structure that has been actually and physically occupied by the
taxpayer. No minimum period of occupancy is required.
Taxpayers selling
their principal residence receive special preferential tax treatment:
exclusion (i.e., no tax) of up to $250,000 for an individual return and
up to $500,000 for married filing jointly if they own and have occupied
the residence for two of the past five years. Foreign sellers may be
exempt from the FIRPTA withholding rules if the new buyer uses the home
as a principal residence.
Excerpt source: from The Language of Real Estate, 6th Edition by John Reilly (published by Dearborn Real Estate Education, 2006 copyright).
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