The PCS Home Sale & Purchase Guide

The Three Doors: Sell, Rent, or Hold

When orders land and the house has to be dealt with, there are three doors. None of them is "right" for everyone; each one is a set of facts. Here is what each door actually costs and risks, so the numbers do the deciding.

The Tax Side: Rules Written for Military Sellers

The tax code carries two provisions that matter enormously for military home sellers, and both are underused because almost nobody knows them. Everything here comes from IRS Publication 523 (Selling Your Home) and Publication 3 (Armed Forces' Tax Guide).

The exclusion everyone gets

When you sell your main home at a gain, up to $250,000 of profit is excluded from federal tax ($500,000 for a married couple filing jointly) if you owned the home and lived in it as your main home for at least 2 of the 5 years before the sale (Internal Revenue Code Section 121).

The military suspension: 2 of 5 can become 2 of 15

Members of the uniformed services can choose to suspend that 5-year test period for up to 10 years while on qualified official extended duty: serving at a duty station at least 50 miles from the home, or living in government quarters under orders, for more than 90 days or indefinitely. In plain terms: PCS away, rent the house out for years, and the clock pauses. The suspension plus the 5-year window can stretch to 15 years total, one property at a time. (IRS Pub. 523, "Service, Intelligence, and Peace Corps personnel.")

Sold early because of orders? A partial exclusion exists

If you owned and lived in the home for less than 2 years but sold because of a move to a new permanent duty station, you do not lose the exclusion entirely: you get a reduced (prorated) exclusion based on the time you did live there. Fourteen months in the house on a $60,000 gain often still means zero tax owed; the worksheet is in Pub. 523.

Two hard facts

Your VA Loan When You Sell: The Assumption Card

VA loans are assumable: a qualified buyer can take over your existing loan at its existing rate, with lender or VA approval. In a market where your locked rate is far below what buyers can get today, that is a genuine selling feature. It also carries one catch sellers need to understand before saying yes.

How an assumption works

The entitlement catch

Your VA entitlement stays tied to that loan until it is paid off, unless the person assuming is a veteran who formally substitutes their own entitlement for yours. A civilian assumption with a release of liability still leaves your entitlement encumbered, which shrinks the zero-down amount available on your next VA purchase. Many buyers still have partial "second-tier" entitlement to work with; the numbers live in the VA Loan Guide, and the VA's regional loan center will run yours for free (877-827-3702).

Renting It Out Instead

The rental door keeps the asset and the low rate, and thousands of military families walk through it every PCS season. It works; it is also a business with real costs that a hopeful spreadsheet tends to skip.

Facts that make the rental door workable

Your occupancy promise is already kept. The VA loan occupancy requirement is about your intent and conduct when you bought, not forever. Having lived in the home and then renting it after a PCS is an ordinary, permitted path. BAH follows you, covering housing at the new station while rent works on the old mortgage. And you may still buy again with a VA loan: entitlement math (bonus/second-tier entitlement) often supports a second VA purchase at the new station even with the first loan outstanding; the VA Loan Guide walks the numbers.

Costs the spreadsheet skips

Help That Exists (Most of It Free)

Nobody has to work this decision alone, and the free help is better than most paid help. Here is the map.

Buying the Next One on Orders

Buying on a PCS clock compresses a 60-day process into whatever time the military left you. The mechanics of a first purchase (preapproval, inspections, the team, the timeline) live in the First-Time Home Buyer's Guide, and the loan itself in the VA Loan Guide. Here is what changes when orders drive the purchase.

Disability-Connected Benefits When You Buy

For veterans with service-connected disabilities, the buying side carries real money that listings and lenders rarely mention unprompted. Every figure here is from VA.gov, fiscal year 2026.

The funding fee exemption

Veterans receiving (or entitled to receive) VA disability compensation are exempt from the VA funding fee entirely, as are eligible surviving spouses and active-duty Purple Heart recipients. On a first-use zero-down purchase the fee is 2.15% of the loan, so the exemption is worth thousands; run your number on the funding fee calculator. If you paid a fee and a disability rating later comes through with an effective date before closing, a refund may be owed; the regional loan center (877-827-3702) handles it.

The housing grants (FY 2026 amounts)

SAH and SHA are grants, not loans (nothing is repaid), can be used up to 6 times over a lifetime up to the cumulative cap, and adjust most years with construction costs. Apply with VA Form 26-4555 (online at VA.gov, by mail, or in person); the VA determines which grant your disabilities qualify for and assigns an SAH agent to work the project. HISA runs through your VA medical care team with VA Form 10-0103 and a provider's prescription. None of these touch your VA loan entitlement.

Property tax exemptions: check your state

Most states offer property-tax exemptions or reductions for veterans with service-connected disabilities, many of them substantial at higher ratings and some total at 100%. The rules, rating thresholds, and application windows are entirely state-by-state, and they change: the authoritative source is your state's department of veterans affairs and your county assessor. When pricing a purchase across state lines, this line item alone can move the monthly cost meaningfully; look it up for every state on your list before you compare payments.

Who to Contact (Keep This List)

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