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Old 11-17-2006   #6 (permalink)
Opatije
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Join Date: Aug 2006
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Re: "If you declared for 700k and sold for 1.2M the taxable gain is only 500k?????"

billwarm: You're right...For some reason I used $700,000 as taxable gain where it should read $500,000. It makes the calculation looks like this:

Made $500,000 profit and paid $150,000 capital gains. Total value of the deal $1,010,000 (made $10,000 profit, however the loss is bigger since you've made the decision to lower the initial value of the home to $700,000. The total loss is $140,000 (loss) + ($-10,000 (profit)) = $130,000)

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