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A taxpayer asks whether the two-year reinvestment period extends if purchasing a new home requires a delayed judicial authorization. The DGT responds that the legal acquisition must take place within this period to qualify for the exemption.
Question posed: The period available for reinvestment in the event that the judicial authorization process is delayed.
To qualify for the exemption, the legal acquisition of the new residence must occur within the two years following the transfer of the primary residence. If the acquisition does not occur within this period, the capital gain generated may not be exempt from taxation. The deadline is strict regardless of the need for judicial authorization for the deed.
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