Updated October 17, 2026. Quick answer: Code H goes in column (f) of Form 8949 when you sold your main home at a gain, have to report the sale, and can exclude some or all of the gain. You report the sale as if you were not taking the exclusion, then enter the excluded gain as a negative number in parentheses in column (g). The Schedule D instructions say which part of the form and which box to use.
IRS worksheets read line by line: Pub 523 Worksheet 1, Pub 523 Worksheet 2 and Pub 523 Worksheet 3.
More IRS forms and schedules for individual filers, read line by line: Form 8828 instructions and Form 5405 instructions.
Related reading on this site: IRS Publication 523.
What code H means
The column (f) table describes the situation like this. The row applies when “You sold or exchanged your main home at a gain, must report the sale or exchange on Part II of Form 8949” (and the table points to the Sale of Your Home section of the Schedule D instructions), “and can exclude some or all of the gain”. For that situation the code is H.
Many home sales never reach the form. The Schedule D instructions say “You may not need to report the sale or exchange of your main home.” They give the reporting triggers: “Report the sale or exchange of your main home on Form 8949 if:” “You can’t exclude all of your gain from income, or” “You received a Form 1099-S for the sale or exchange.” The instructions add “Any gain you can’t exclude is taxable.”
The two tests behind the exclusion
Whether you can exclude gain is decided under the tests in the Schedule D instructions, not by the code. They say “Generally, if you meet the following two tests, you can exclude up to $250,000 of gain.” “If both you and your spouse meet these tests and you file a joint return, you can exclude up to $500,000 of gain” (the instructions note that only one spouse needs to meet the ownership requirement in the first test).
The first test reads “During the 5-year period ending on the date you sold or exchanged your home, you owned it for 2 years or more (the ownership requirement) and lived in it as your main home for 2 years or more (the use requirement).” The second test reads “You haven’t excluded gain on the sale or exchange of another main home during the 2-year period ending on the date of the sale or exchange of your home.”
The instructions also describe a smaller exclusion: “Even if you don’t meet one or both of the above two tests, you can still claim an exclusion if you sold or exchanged the home because of a change in place of employment, health, or certain unforeseen circumstances.” “In this case, the maximum amount of gain you can exclude is reduced.” A related page on selling a house after 65 is at capital gains when selling a house over 65.
What to enter in column (g)
The table’s instruction for code H is “Report the sale or exchange on Form 8949 as you would if you weren’t taking the exclusion.” “Then enter the amount of excluded (nontaxable) gain as a negative number (in parentheses) in column (g).”
The Schedule D instructions give the same steps: “If you had a gain and can exclude part or all of it, enter “H” in column (f) of Form 8949.” “Enter the exclusion as a negative number (in parentheses) in column (g) of Form 8949.” “Complete all columns.” Column (d) is the proceeds. The instructions say that for Form 1099-S “always report the proceeds (sales price) shown on the form (or statement) in column (d) of Form 8949”.
The IRS example, with two codes on one row
The column (g) instructions work through a home sale. In their words: “You sold your main home in 2025 for $320,000 and received a Form 1099-S showing the $320,000 gross proceeds.” “The home’s basis was $100,000.” “You had selling expenses of $20,000 that weren’t included on your Form 1099-S.” “Under the tests described in Sale of Your Home in the Instructions for Schedule D (Form 1040), you can exclude the entire $200,000 gain from income.”
Then the filing steps: “On Form 8949, Part II, check box F or box L at the top.” “Complete columns (a), (b), and (c).” “Enter $320,000 in column (d) and $100,000 in column (e).” “Enter “EH” in column (f).” “In column (g), enter $220,000 ($20,000 selling expenses + $200,000 exclusion) as a negative number.” “Put it in parentheses to show it is negative.”
Two things stand out. The row carries both an E, for the selling expenses, and an H, for the exclusion, and they sit side by side in the order the instructions require. And the column (g) entry is one net number covering both adjustments. For the long-term versus short-term choice and the box letters, see Form 8949 boxes A to L.
Which part and box for a home sale
The Schedule D instructions say where the sale goes: “If you have to report the sale or exchange, report it on Form 8949.” “If the gain or loss is short term, report it in Part I of Form 8949 with box C or box I checked.” “If the gain or loss is long term, report it in Part II of Form 8949 with box F or box L checked.”
Where it goes next
Column (h) is the result. The instructions say “First, subtract the cost or other basis in column (e) from the proceeds (sales price) in column (d).” “Then take into account any adjustments in column (g).” “Enter the gain (or loss) in column (h).”
Form 8949 feeds the Schedule D. The instructions open with “Complete Form 8949 before you complete lines 1b, 2, 3, 8b, 9, or 10 of Schedule D.” They also say “Include on your Schedule D the totals from all your Parts I and II.” The totals line at the bottom of Part I tells you to “Enter each total here and include on your Schedule D, line 1b (if Box A or Box G above is checked), line 2 (if Box B or Box H above is checked), or line 3 (if Box C or Box I above is checked)”. Part II says to “include on your Schedule D, line 8b (if Box D or Box J above is checked), line 9 (if Box E or Box K above is checked), or line 10 (if Box F or Box L above is checked)”. The Schedule D itself is explained on the Schedule D page, and the full set of form instructions is on Form 8949 instructions.
Edition and line numbers
This page reads the 2025 Form 8949 and its 2025 instructions, along with the 2025 Schedule D instructions where cited, the current files irs.gov served on 2026-10-17. They are the forms for the tax year 2025 return, filed in 2026. Check the tax year printed on the form you are filling in and use the column letters and codes on that year’s form, because a different year’s form can letter its columns or word its codes differently.
Common mistakes
- Leaving the excluded gain out of column (g), or entering it as a positive number. The instructions say “Then enter the amount of excluded (nontaxable) gain as a negative number (in parentheses) in column (g).”
- Skipping the sale because a Form 1099-S arrived. The Schedule D instructions say you report the sale on Form 8949 if “You received a Form 1099-S for the sale or exchange.”
- Assuming a loss on the home is treated the same way. The Schedule D instructions say “If you had a loss but have to report the sale or exchange because you got a Form 1099-S, see Certain Nondeductible Losses, later, for instructions about how to report it.”
Related: Form 8949 instructions, Schedule D, Capital gains when selling a house over 65, and Capital gains tax calculator.
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- Instructions for Form 8949 (2025): https://www.irs.gov/pub/irs-pdf/i8949.pdf
- Form 8949 (2025): https://www.irs.gov/pub/irs-pdf/f8949.pdf
- Instructions for Schedule D (Form 1040) (2025): https://www.irs.gov/pub/irs-pdf/i1040sd.pdf
Read from the IRS documents linked above on October 17, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.