Main home is a term used primarily by the IRS to indicate the residence that a taxpayer has lived in for most of the time during a given taxation year. The classification of a person’s main home is important when taking into account gains resulting from selling the home, because the tax code allows you to partially exclude capital gains from a sale if you pass the ownership and use tests. This is how it breaks down: if you have owned a home for more than two over the previous 5 taxation years, and it was your main home, then you can exclude up to $250,000. However, losses from the sale of your main home cannot be deducted.
If you own or live in more than one home, you must apply a facts and circumstances test to determine which property is your main home. Factors besides where you spend the most time include what address is listed on your driver’s license, where you are registered to vote, and where your government documents tie you to. Time spent on vacation doesn’t count as living in another home in the eyes of the IRS, because they take into account things like where you live, where you bank, or any community organizations of which you are a member to determine what your main home really is.