Good morning. Your capital gain is $800,000 less $500,000. Your credit card debt is not relevant to the computation of gain because it is not part of your basis and it does not reduce your sale price. So, you have a capital gain of $300,000. You can use the $250,000 capital gain exclusion ($500,000 if you are married).
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The creditor I was referring to is not a credit card creditor, it is actually someone who has taken a 2nd trust deed out on the property, with the total amount being close to $200,000.
Would paying off that debt be deducted from the Capital Gains tax? If not, what would be deducted exactly?