The $250,000 capital gains tax exclusion lets you avoid paying capital gains tax on up to $250k of profit when selling your primary residence ($500k if married filing jointly).

Requirements:

• Own the home 2 of the last 5 years

• Live in it as your primary residence for 2 of the last 5 years

• Can only use once every 2 years

If you qualify, only gains above $250k ($500k for couples) are taxable.