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Richard, Tax Attorney
Category: Tax
Satisfied Customers: 55319
Experience:  29 years of experience as a tax, real estate, and business attorney.
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I just sold a 2nd home and need to know approximately what

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I just sold a 2nd home and need to know approximately what percent of the revenue I should expect to have to pay when I file my taxes next year. My wife and I file jointly and earn about $105000 yearly. House sold for $50,000.

Welcome! My goal is to do my very best to understand your situation and to provide a full and complete answer for you.

Good morning. How much did you pay for the house and did you spend any money since the purchase on improvements..if so, how much? Thanks.

Customer: replied 4 years ago.

The house was the one I grew up in. I bought it from my Dad/Mom back in the mid 80's and they lived in it until they passed away earlier this year. I paid $42,000 for the house. Only improvements was a roof we had installed for $3500 but no receipt can be found. I had left it with Dad in case it was needed sometime for repair and wasn't able to locate it. I had a dishwasher installed a couple of months ago ($250). Nothing else.

Thanks. You pay tax on the gain...$50,000 (less closing costs) minus your basis, which is $42,000 plus the $3500 plus the $250. Thus, you have gain of $4250. Because you have owned it as long as you have, this is long term capital gain taxed at 15%. So, your tax is 15% times $4250.

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Customer: replied 4 years ago.

Very happy and satisfied with the advice you have given me. Much appreciated.

You're pleasure! Take care.

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