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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 13316
Experience:  15years with H & R Block. Divisional leader, Instructor
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I have a home Im selling for $60,000 I have a heloc loan

Customer Question

I have a home Im selling for $60,000 I have a heloc loan owed for $49,000on the home.Will there be capital gains tax due? The heloc loan was used for repairs to the home to ready it for sale.
Submitted: 5 months ago.
Category: Tax
Expert:  Robin D. replied 5 months ago.

Hello

Your gain is calculated by the purchase price plus improvements and the sale price less costs to sell.

You listed your sale price ($60k) so the difference in that (less the costs you have to sell like commission) and the actual cost of the home plus the amount you spent to make capital improvements would be the amount that is taxable.

If this was your main home for 2 out of the last 5 years you can use the IRC 121 law to exclude gain up to $250,000 if single and up to $500,000 if married filing joint.

Please let me know if you need clarification. If you do not then a positive rating is appreciated so I get credit for the response.

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