Your name saw this post on The ActiveRain Real Estate Network and thought it might be of interest to you. Please see the link below to review the post.
Caluculating Capital gains
Thousand Oaks Real Estate
You may find this information useful and possibly even timely. Above all, take it as an example and a possible inspiration to contact a professional accountant, CPA or attorney.
To determine your gain, you should go through a series of calculations.
An example: You purchased you home for $250,000
You sell it for $700,000
You spent $20,000 in eligible purchases and upgrade expenses (taxes and major improvements and $49,000 in selling expenses (which includes real estate commission, exise taxes, title, escrow, etc. Be sure and check with your accountant for allowable expenses).
Subtract the selling costs, approximately $49,000, from the closed sales price $700,000, giving you a total of $651,000.
Add the cost of your major improvements, in this example I am using $20,000, to the original purchase price of $250,000. This determines the adjusted cost basis. The total in this example is $270,000.
Subtract the adjusted base of $270,000 from the adjusted selling price of $651,000, (which equals $381,000) to determine your capital gain.
Don't forget the other pieces of the puzzle. You must do the same calculations on any home(s) that you owned prior to this transaction.
You should be keeping meticulous ... more
Are you on The Rain? Grow Your Network!