avoiding capital gains on selling a house

[philm]

Hi There,

We have been fixing up a nice house in hopes of living there full time, currently we live in an apartment where our jobs are but the house is in a different county, my wife has had some medical problems lately and our debt is piling up. we were thinking of finishing up the house, trying to sell it and pay off our debt and try to start over, but its only worth it if i we can make a certain amount of money off of it, otherwise we will try to keep it. We want to sell the house, pay off all of our debt, buy a yurt (we were looking at

shelter designs

for full year round living in northern wisconsin), buy some land, all in cash so we dont have a mortgage. we will not make over $250,000 on the sale (we are hoping for around $140K), and i know you dont have to pay capital gains on your primary residence. we do not live there currently, but it was our plan for it to be our primary residence, its just we live in an apartment now were our jobs are before we move. Would someone just see it as an investment property and i would have to pay the capital gains tax on it? or do we physically have to live there first for a certain amount of time? Just curious, thanks.

[Jafo]

I really think you would need to ask an accountant who is familiar with your situation. It has been my experience that yurt enthusiasts may not necessarily be the best tax specialists.