We found no Texas rule that makes an owner wait to resell. The timing limits come from elsewhere: federal tax rules reward holding more than one year and living in the home two of five years, FHA buyers cannot finance a resale within 90 days, and your own loan papers may add terms.
You can put a Texas house back on the market soon after you close on it. We found no state rule that makes an owner wait. The real limits come from three other places: federal income tax rules, the type of loan your buyer uses, and the terms of your own mortgage. Each has its own clock, and they do not run on the same schedule.
This guide explains those clocks for any Texas owner. If the house is in Tarrant, Dallas, Collin or Denton County, the DFW version of this guide shows how to confirm your purchase date and exemption status in local records.
Clock one: the one-year line for capital gains
A home is a capital asset. IRS Topic No. 409 says that if you hold an asset more than one year before you sell, your gain or loss is long-term. If you hold it one year or less, it is short-term. You count from the day after the day you acquired it, up to and including the day you sell. A lower tax rate may apply to net long-term gains than to ordinary income.
Two more points from the same IRS page matter to a quick seller. A loss on the sale of a personal-use home is not deductible. And the one-year line matters only for gain that is taxable, which brings in the second clock.
Clock two: the two-out-of-five-year exclusion
IRS Publication 523 lets you exclude up to $250,000 of gain, or $500,000 for a married couple filing jointly that meets the rules, if you pass its eligibility test. The core of that test:
- Ownership. You owned the home for at least 24 months of the 5 years before the sale.
- Residence. You lived in it as your main home for at least 24 months of those 5 years. The time need not be continuous; 730 days in total is enough.
- Look-back. You did not exclude gain from another home sale in the 2 years before this one.
Sell before you reach 24 months and you generally do not get the full exclusion. That can be costly when the house has gone up in value.
Partial exclusion: Publication 523 allows a reduced exclusion when the main reason for selling early was a work-related move (a new job at least 50 miles farther from the home than the old one), a health-related move, or an unforeseeable event. Its list of unforeseeable events includes the home being destroyed or condemned, a death, a divorce or legal separation, a birth of two or more children from one pregnancy, and becoming eligible for unemployment compensation. The rules have more conditions; a CPA can tell you whether yours fit.
Paying back a subsidized mortgage
If you bought with help from a federally subsidized program, there is a third tax issue. Publication 523 tells sellers to check for federal mortgage subsidies received in the 9 years before the sale. Loans from tax-exempt qualified mortgage bonds and loans with mortgage credit certificates may require you to pay back part of that benefit as extra tax, even if the gain itself is excluded. The IRS directs sellers to Form 8828 to figure it. If you used a first-time buyer program, ask the program or a CPA whether your loan counts.
Clock three: your buyer's FHA loan
Your timing also affects who can buy from you. Federal rule 24 CFR 203.37a governs FHA-insured mortgages on resales. It measures from the date you acquired the home, based on your settlement date, to the date the buyer signs the purchase contract:
| Time since you closed | FHA eligibility for your buyer |
|---|---|
| 90 days or less | Not eligible for FHA insurance |
| 91 to 180 days | Generally eligible; if the price is 100 percent or more above what you paid, the lender needs more documentation, including a second appraisal |
| 91 days to 12 months | Eligible, but HUD may require extra support for the value in some cases |
| More than 12 months | Eligible |
The rule lists exceptions, including homes the seller inherited, sales by a relocation company for a transferred employee, and sales by HUD, other federal agencies, banks and government agencies. The same section also requires that an FHA buyer purchase from the owner of record.
For a seller, the practical point is simple. If you closed less than 91 days ago, a buyer relying on an FHA loan cannot close with you yet. The rule governs FHA-insured loans; it does not limit a buyer paying cash.
Your own loan papers
Your mortgage is a contract with its own terms. Two to look for before you list:
- Occupancy. If you financed the purchase as a home you would live in, your deed of trust may contain an occupancy promise. Read the paragraph titled Occupancy, if there is one, and ask the lender or a Texas real estate attorney what it requires of you.
- Prepayment penalty. Paragraph 12A(1)(a) of the TREC resale contract makes the seller responsible for releasing existing liens, including any prepayment penalty. Check your note to see whether it has one.
What happens to the homestead exemption
Property tax exemptions in Texas follow ownership. Under Tax Code Section 11.42(f), a person who buys a home after January 1 can get the homestead exemption for the rest of that year, but only if the previous owner did not receive the same exemption that year. Section 11.43(c) says an exemption, once allowed, applies until the property changes ownership. Section 11.43(d) gives a buyer who acquires after January 1 until the first anniversary of the purchase to apply for that partial-year exemption.
When you resell, paragraph 13 of the TREC contract prorates the current year's taxes through closing, and it allows the proration to account for any change in exemptions that affects that year. If your exemption status is unclear because you bought recently, tell the title company early.
Count both sets of closing costs
A quick resale means paying selling costs soon after paying buying costs. Publication 523 treats selling expenses, such as commissions and legal fees, as reductions to the amount you realize on the sale. Our guide to who pays closing costs in Texas shows the seller's usual share. If you need to sell because of a life change, our pages on selling during a divorce and selling an inherited house cover those paths.
A quick-resale checklist
- Find the exact closing date of your purchase on your closing statement.
- Count the days to your target contract date; note 91 days, 181 days and one year.
- Count your months of ownership and residence toward the 24-month tests.
- Check for a subsidized loan and a prepayment penalty.
- Read your deed of trust for an occupancy paragraph.
- Talk with a CPA before you sign if you expect a gain.
Selling soon after buying to Cash Home Advisors
A cash sale does not depend on FHA eligibility. When Cash Home Advisors buys a house, our purchase does not depend on a bank loan. We pay all closing costs, and we can close in 7–14 days. The tax and loan questions above are still yours, and you see the full closing statement before you sign.
You can ask for a cash offer, read how our process works, or see the kinds of houses we buy.
Want a cash offer instead?
We buy Texas houses as-is, pay all closing costs, and can close in 7–14 days.
Get my cash offer or call (817) 635-0743
Frequently asked questions
Do I pay capital gains tax if I sell my Texas house within a year?
If you have a gain and do not qualify for the home sale exclusion, a gain on a home held one year or less is short-term under IRS rules. A CPA can run your numbers.
Can I still get the $250,000 exclusion if I sell before two years?
Possibly a partial one. IRS Publication 523 allows a reduced exclusion when the main reason for the sale was a qualifying work move, a health issue, or an unforeseeable event such as a death, divorce, or job loss with eligibility for unemployment compensation.
Can a buyer use an FHA loan on a house I bought three months ago?
Federal rules say a home is not eligible for FHA insurance if the buyer's contract is signed 90 days or less after the seller's purchase closed. Between 91 and 180 days, it is generally eligible, but a resale price 100 percent or more above what the seller paid requires extra documentation, including a second appraisal.
Does a recent purchase change my Texas homestead exemption?
Under Texas Tax Code Section 11.42(f), a buyer who acquires a home after January 1 can get the homestead exemption for the rest of that year only if the previous owner did not receive it. An exemption, once allowed, stays until the home changes ownership.
Sources
- IRS Publication 523, Selling Your Home
- IRS Topic No. 409, Capital gains and losses
- Electronic Code of Federal Regulations, 24 CFR 203.37a Sale of property
- Texas Tax Code, Chapter 11 (Sec. 11.42 and 11.43 exemption timing)
- Texas Real Estate Commission, One to Four Family Residential Contract (Resale), TREC No. 20-19
General information, not legal or tax advice. Talk to a Texas attorney or CPA about your situation.