Sales of a Principle Foreign Residence A principal residence abroad is any property you have lived in for at least two of the last five. When you sell your principal residence, you are eligible for a gain exclusion of $250,000 USD, or $500,000 USD for married principal owners. If you don’t qualify for the gain exclusion, any gain will be considered foreign income and thus eligible for the Foreign Tax Credit. This income is not considered foreign earned income and will not qualify for the  Foreign Earned Income Exclusion.    You don't really have to post the same question 3 times you know......

<  >  codes in the letter are primarily used when something above it in the letter  [  ] has triggered the information to print.  The <code> you have is a state code, so I suspect you have accidentally erased a [ or a ] somewhere right above it. There are  whole sections of the 'letter' that get generated by  a [@BeginStateText] operator.  If you are in a client specific letter for that client, delete it and create another one.  If you have altered the standard client letter, to your liking, and it has worked properly with state returns before, then you have, as I stated above, inadvertently (which is easy to do) erased a [ or a ] I suspect.

the problem is not in his name.  It's in his SSN.  I suspect that the 17 filed his own taxes, and claimed himself on that return, not knowing he did not need to do that.  try to get a copy of that 17 yr old super genius's return, and I would almost guarantee that is what has happened.  if that is the case, then; 1) file an amended return for the 17 yr old tax pro, and change to where he IS claimed by someone else.  Unless he made a ton of money, should not change his refund one bit. 2), then wait...and wait..and wait a little more, and then paper file the parents return with the explanation of what happened and the child's return has been amended to reflect being claimed by the parents.

Well, the plot thinnens... NOT ELIGIBLE FOR ELECTRONIC FILING Your client's federal return is not eligible for electronic filing due to the following reason: You have an amount on Form 3800 Part III, Line 1e from Form 8826. ProSeries does not support this information to be filed electronically.   I've had to "un-solution" you Bill.       🙂          

If the house and 30 acres are one parcel of property, i would certainly say it all was available for the 2 year residency exclusion. But, I'm having a little trouble understanding the first sentence.   So did the 30 acres of land and the cost of the house build equal $750,000? or did he buy the 30 acres of land for $750k, and can't remember the house cost?

@MikeA1 .  I try to refile the parents return on a daily basis, and each day i get the dreaded red thumb of death.  But I'm holding out, and refiling every day.  Some day maybe I'll see some green when i file it.

You do know that when you click on an amount on a line that is not a number you have input and it has the little magnifying glass symbol, that you can click on it and it will take you back to the form that number came from.  and keep doing that til you reach the limitation form.   Also, if you are at a line, and click on it, and the magnifying glass doesn't appear, you can right click your mouse, and find the last two options of that right click (cross reference, etc), they will normally  lead you to those calculations.

Simple.  If you have 'double-checked" your input.  Then, find the $790 credit on your 1040.  And drill down on each preceding form, until you find the form with the limitation. then STUDY and REVIEW that form to find your answer.  That is what 99.9% of tax preparers would do.  So they would know the answer themselves the next time this issue arose. You can't expect this community to analyze every return that you don't understand.