Sarah (single) purchased a home on January 1, 2008, for $600,000. She eventually sold the home for $800,000. What amount of the $200,000 gain on the sale does Sarah recognize in each of the following alternative situations? (Assume accumulated depreciation on the home is $0 at the time of the sale.)

b. Sarah used the property as a vacation home through December 31, 2017. She then used the home as her principal residence from January 1, 2018, until she sold it on January 1, 2021.

What is the gain recognized?