Deductions & credits

It's probably correct.

If you paid for the house equally, then your basis was $215,000.  Your selling proceeds are $322,000 and your capital gain is $107,000.  It doesn't matter how much cash you received, your gain is $107,000.  (If the reason you received less cash is that you had an outstanding mortgage, that just means you took money out of the house in advance via a mortgage loan--and didn't pay tax on it at the time, so part of your gain was taken out early.)

 

Since you owned and lived in the house more than 2 years, you qualify to exclude up to $250,000 of the gain from any tax.  Since you got a 1099-S, you must report the sale, but it should not be counted as taxable income if you report it correctly.

 

In fact, you can also reduce your capital gains by taking into account certain adjustments.  Certain closing costs raise your cost basis, and certain selling expenses lower the selling price.  This is discussed in publication 523.  But because your gain is already less than $250,000 without the adjustments, we don't really need to spend too much time analyzing them.

https://www.irs.gov/forms-pubs/about-publication-523