Tax break for widowed homeowners selling primary residences
H.R. 7349 — Time to Heal Act · Filed by Tom Barrett (R-MI) · 2 cosponsors · Introduced Feb 4, 2026 · Referred to committee
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What it does
This bill amends the tax code to allow individuals whose spouses have died to exclude up to $500,000 in capital gains from the sale of their primary home—the same exclusion available to married couples filing jointly—provided they have not remarried and the couple met the ownership and use requirements before the spouse's death. Currently, widowed individuals are limited to the $250,000 single-filer exclusion regardless of how long ago their spouse died.
Why we flagged it
The bill's sole operative mechanism is a targeted tax exclusion increase for a specific demographic (widowed individuals selling primary residences), with no broader policy purpose or public-service component.
What the text implies
- The $500,000 exclusion applies only if the couple met ownership/use requirements before death and the survivor has not remarried—creating a potential marriage-penalty cliff for widowed individuals who remarry, who would lose the benefit retroactively.
- The bill does not address the interaction with stepped-up basis rules (IRC §1014), which may allow heirs to inherit property at fair-market value with no gain recognition—meaning some widowed individuals may already face minimal tax on inherited homes, limiting the practical benefit.
The full analysis lists 3 implications of this text.
Who stands to gain
Widowed homeowners selling primary residences in high-appreciation markets