Most married couples can shield up to half a million dollars in home profit from Uncle Sam. By Kimberly Lankford, Contributing Editor August 4, 2014 We just sold our house and got a great price for it. How do I figure out whether I need to pay taxes on the profit?It depends on how long you’ve lived in the house and how much profit you made. If you lived in the house for at least two out of the past five years, you can exclude up to $500,000 in home-sale profits from your taxes if married filing jointly, or $250,000 if single. See Also: Tax Planning for Selling Your Home If you haven’t lived in your home that long, you may still be able to exclude part of the profit if you moved because of a new job (it must be at least 50 miles farther from your old home than your old job was), experienced a change in health or had another unforeseen event, such as a divorce or multiple births (for a full list, see IRS Publication 523, Selling Your Home). In that case, you could exclude a percentage of the profits, based on the portion of the two years that you did live in the house. For example, if you lived in the house for one year and then had to move to another state because of a new job, you could exclude as much as $250,000 in gains—half of the $500,000 exclusion—if you’re married filing jointly. Anything over the limit should be reported on Schedule D as capital gains. If you spent enough money on eligible home improvements, you may not owe taxes on the home-sale profits even if you sold the house for more than $500,000 over the purchase price. To calculate the size of your profit, take the sales price of the house (minus certain selling expenses, such as the real estate agent’s commission and any points paid by the seller) and subtract the adjusted tax basis. The adjusted tax basis is the original cost of the home plus certain settlement fees or closing costs you paid. You can also add the cost of major home improvements to the basis, such as a new roof, a remodeled kitchen, or a new heating or air-conditioning system. (Basic repairs don’t count.) See IRS Publication 523 for more details about which expenses count. Got a question? Ask Kim at email@example.com.