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Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 3766
Experience:  20+ years of experience in tax preparation; 25+ years of experience as a real estate/corporate paralegal.
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Capital gains tax on vacation house-how is it calculated

Customer Question

Capital gains tax on vacation house-how is it calculated
Submitted: 1 year ago.
Category: Tax
Expert:  Barbara replied 1 year ago.

Welcome to Just Answer. My name is ***** ***** I will be happy to assist you today.

If you sell your second home, your capital gains is the portion of the proceeds that exceeds what you paid for the property, plus the cost of any improvements you made over the years. You can deduct many of the closing costs associated with the sale from your proceeds.

In other words, you pay capital gains tax on the DIFFERENCE between what you paid (plus improvements, i.e., new roof, etc.) and your sales price (less closing costs, real estate commissions, etc.).

Please let me know if you require further information or clarification.

Thank you and best regards,

Barb

Expert:  Barbara replied 1 year ago.

Just following up with you to see if you have any other questions or concerns. If so, please come back to me here at your convenience, and I will be happy to assist you. If not, please take a moment to rate my answer since that is the only way I receive credit for answering you and alerts Just Answer to compensate me for a portion of the fee you previously paid.

Best regards,

Barb