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by CareyBot

DEAR BOB: I have been an enthusiastic reader for years, but now I am writing for elderly friends who are selling their large house where they lived for 20 years. They want to "downsize" and buy a smaller house. Their CPA advised them they will owe a huge tax even after their $500,000 principal residence sale exemption. But I disagree since they are buying a less expensive home. I've enclosed the numbers. Who is right? – Ernst S. DEAR ERNST: Congratulations on looking out for your elderly friends and for including the details of their home sale. Unfortunately, the CPA is correct and you are mistaken. Purchase Bob Bruss reports online. The old "rollover residence replacement rule" of Internal Revenue Code 1034 no longer applies to home sellers buying replacement homes. That tax brea...