Actually, we’re trying to figure out how to get the money out of our two homes in CA w/o giving CA huge capital gains. Nevada is the antithesis of CA, NO State income tax, coupled with very low property taxes. CA is going to have a financial meltdown and when it does RE values will drop like a rock. We need to be gone before that happens.
I got nailed on my State and Federal Taxes selling a Rental Condo in CA.
Even if you live in it for two years within the five years before the Sale, you still have to pay Capital Gains on the Depreciation you took while owning it.
In the old days you avoided repaying the Depreciation AND the Gain on the Sale by living in it for those two years. No more, you always pay the Piper. Cost me a mint.