An obsolete tax law that provided homeowners over the age of 55 with a one-time capital gains exclusion. Individuals who met the necessary requirements could exclude up to $125,000 of capital gains on the sale of their personal residences. The exclusion was intended to stimulate the real estate market and reward homeowners for their purchase and subsequent sale.

The over-55 home sale exemption was superceded by provisions in the 1997 Tax Reform Act. This act raised the amount of excludable gain to $250,000 per taxpayer, and also allowed for more than one exclusion per taxpayer per lifetime.