Hal_Al
Level 15

Deductions & credits

Q.  Can we avoid capitol gains or at least reduce it?

A. No. 

 

As others have said, you are selling a "2nd home". The gain on the sale is a taxable long term capital gain (LTCG), subject to long term capital gains rates. Depending on how much total income you have LTCG are partially taxed at 0%, 15%, 20% and/or 23.8%.