How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Phillip B, EA Your Own Question
Phillip B, EA
Phillip B, EA, Enrolled Agent
Category: Tax
Satisfied Customers: 704
Experience:  Practicing since 2004. Expert in 1040, small business, represent vs. IRS, & int'l tax mattters.
Type Your Tax Question Here...
Phillip B, EA is online now
A new question is answered every 9 seconds

I purchased investment property with a second from my primary

This answer was rated:

I purchased investment property with a second from my primary home, I sold the property and need to know what options I have to minimize the tax impact. Can I use the proceeds to pay off the second and put the remainder against my first mortgage and not be taxed ?

Thanks for using!


Unfortunately, if the sale has happened it is probably too late to do anything about the tax implications.


You could have done a section 1031 exchange (have a third party by a new investment property with the proceeds of the sale) if you would have planned things out prior to the sale. However, once you received a check or cash from proceeds on the sale, the gain in irreversibly taxable.


If there are further questions, please reply to this answer so that I may assist you further. If this answers your question, please rate my performance between OK and Excellent so that I may receive credit for my work. Thanks for your business.

Customer: replied 4 years ago.

The gains , what can I write off ?

The gain is calculated by taking the total sales price less the purchase price of the investment property and any improvements or additions from the property (the cost basis). You can deduct any money you spent improving or maintaining the property that wasn't otherwise deducted (for example, almost any expense incurred and paid on the property could be included in the cost basis if the expense was not also deducted as a rental or business expenses).

Let me know if this helps.
Phillip B, EA and 2 other Tax Specialists are ready to help you