The same $600,000 gain on the house costs a couple about $5,500 in federal tax and a single seller about $62,500.And the Medicare premium goes up in 2028.
After the exclusion is applied, a couple owes nothing on a $500,000 gain, about $5,500 on $600,000, about $43,200 on $800,000 and about $80,800 on $1,000,000. A single seller owes about $43,700 on a $500,000 gain, about $62,500 on $600,000 and about $151,000 on $1,000,000, because one person only gets half the exclusion. The 3.8% net investment income surtax sits on top once income crosses its line. Then Medicare looks back two years, so a 2026 sale sets the 2028 premium, and a home sale is not on the Social Security list of life-changing events, so an SSA-44 appeal will not undo it. One rule saves a lot of that: a surviving spouse who sells within two years of the death still gets the full $500,000 exclusion. From Jim Swiech, CPA.
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Quick answers
- How much federal tax will I owe on selling my house in retirement in 2026?
- It depends on the gain left after the exclusion, and on whether you file jointly or as a single person. A couple who lived in the home can exclude $500,000 of gain, a single seller $250,000. In the example on this page, both 65 or older with $80,000 of other income, a couple owes $0 on a $500,000 gain, $5,526 on $600,000, $43,220 on $800,000 and $80,820 on $1,000,000. A single seller owes $43,694 on a $500,000 gain, $62,494 on $600,000 and $151,012 on $1,000,000. The exposed gain is taxed at the long-term capital gain rates, and the 3.8% net investment income surtax is added once income crosses its line.
- Does selling my house raise my Medicare premium?
- Yes, two years later, if the gain pushes your income past an IRMAA line. Medicare sets your 2028 premium from the income on your 2026 return, so a 2026 sale shows up in 2028 and then drops back off. In the example on this page a single seller with a $400,000 gain pays $529.60 more a month in 2028 for Part B and Part D together, and each spouse in a couple with an $800,000 gain pays $385.00 more a month. Selling a house is not on the Social Security list of life-changing events, so the SSA-44 appeal does not remove it.
- Do I still get the $500,000 exclusion after my spouse dies?
- Yes, if you sell within two years of the date of death, you have not remarried, and the ownership and use tests were met before the death. After that window a surviving spouse is limited to the $250,000 single exclusion. Two things soften it. The basis on the half of the house that belonged to your spouse steps up to its value at the date of death, which often cuts the gain more than people expect, and the improvements you have paid for over the years raise your basis too if you can document them.
This printable is educational and general in nature, it is not tax, legal, or investment advice. Figures are 2026 federal amounts under stated assumptions, and the Medicare lines shown for 2028 are today's tiers, which will be indexed. Outcomes depend on your specific facts. Go Beyond Tax is a brand of Swiech Consulting LLC.