Last week we answered common questions about what happens when a homeowner sells and how much tax must be paid. Here are a few more commonly asked questions on the topic:

Q: I understand that a person needs to own and occupy a house as their residence for at least two of the five years immediately preceding the date of sale in order to qualify for this tax break. But what if I have not lived there for the full two years? Let's say I have lived there only 18 months. Is there any way I can still get a tax break?

A: Yes. Sometimes you can take a prorated amount of the exclusion for which you would otherwise qualify. If you were a single owner and would have qualified for a tax-free gain of up to $250,000 but have lived in the house only 18 months, you still might be able to exclude 75 percent of the $250,000 limit if one of these three things exists:

• You can show that the primary reason for your move was a change in your health or a change in the health of an immediate family member. Typically, a statement from a physician recommending a move for health reasons would be sufficient.

• You can show that the primary reason for your move was a change in employment. Here the IRS has given us some specific guidelines, saying your new job must be at least 50 miles farther from your home. This is the same standard the IRS uses to determine whether you can deduct moving expenses when you change jobs.

• You can show that your move was necessitated by unforeseen circumstances. This can be interpreted to mean just about anything, so the IRS has recently given more guidance as to what will and won't qualify as an unforeseen circumstance. Here are five examples of what would likely pass muster:

• Death of the owner, spouse, or family member living there.

• You moved because of a divorce or legal separation.

• You suffered damage from a hurricane or an earthquake or even a terrorist act.

• You simply can no longer afford to live where you are, either because your income has dropped or perhaps it has become very expensive.

• You are having twins. The IRS says "multiple births" will qualify for this break.

On the other hand, one thing that's unlikely to qualify as an unforeseen circumstance is a move from a cold climate to the Sun Belt just to get away from bad weather. The IRS refers to such a move as a "quality of life" migration.

My advice is to talk with your accountant before selling to make sure your situation will qualify under the rules.

Q: I understand that if I live in my current house for two years and then sell, my wife and I can pocket up to $500,000 tax free. But what is the tax if I exceed that amount?

A: The excess over your exclusion is treated as a capital gain and is taxed by the federal government and the state. The current federal tax rate for long term-capital gains income is 15 percent for most taxpayers, and the Georgia tax is 6 percent, so your effective tax rate would be 21 percent.

Q: How long do I have to move into my next house?

A: There is no requirement that you reinvest in anything. That is one reason this exclusion is so powerful. It gives you many financial options you may not have had before. Many longtime homeowners have large sums of profit tied up in their homes and felt that they could not afford to sell and pay the taxes that would become due. Under the current rules for principal residence, owners can sell and move into an apartment or purchase a less expensive home if they choose.

This rule opens up many possibilities for owners. Some have chosen to:

• Sell their highly appreciated homes and help their children buy a large home with a "grandparents' suite" in the basement. The sellers are now free to travel more often without the headaches of ownership, and the children get some help. That help might be in the form of rent or gifts or ownership of the real estate.

•  Sell their home and move to a condo at the beach or in the mountains. This might be a purchase or it might be rental. If it is rental, the sellers are left with a lump sum to invest as they see fit, perhaps to sustain their lifestyle in future years.

When Congress drafted this legislation in 1997, some speculated that the new rules would spark a flood of sales in high-end homes as owners who felt trapped moved to retrieve their tax-free gains, but there have been no unusual sales along those lines.

John Adams is a broker and investor. His Web site is www.money99.com.