40/60 Condominium |link| May 2026

But here is the kicker: Under Section 121, a married couple can exclude $500,000 in gains. Unmarried co-owners? Each gets only $250,000 of exclusion on their share of the gain.

Partner B (the 40% owner) often argues: “I may own less, but I painted the walls. I fixed the leaky faucet. I waited for the plumber.” 40/60 condominium

The successful 60/40 pairs create zones of absolute control. The 40% owner gets the primary bedroom. Or the parking spot. Or veto power over house guests. It is not about math. It is about dignity. But here is the kicker: Under Section 121,

If the 60% owner makes every decision—where to hang the TV, whether to buy the expensive garbage disposal, when to host Thanksgiving—the 40% owner will eventually feel like a tenant who happens to have equity. Tenants leave. Tenants force partition sales. Partner B (the 40% owner) often argues: “I

But if the profit is $600,000? The 60% owner’s share is $360,000. They pay capital gains on $110,000 ($360k minus $250k exclusion). The 40% owner’s share is $240,000, which is fully excluded. The 60% owner writes a check to the IRS. The 40% owner does not. Cue the argument. After all the legal scaffolding, the 40/60 condo succeeds or fails on a single question:

By J. Hartwell