Couple of questions, but one at a time so I can keep my head straight. Done a bit of research on this, and "had" what I believed to be a useful response. But now you've raised eyebrows here.
1. How can you reduce original basis at time of sale to zero? Assuming you paid $23,500 for the house when you originally bought it, then spent $15,000 on qualified property improvements, that makes your adjusted cost basis at the time you sold it, $38,500.
2. What is "loan = $20,000". Is this a loan "you" have and that "you" are paying back to the original mortgage holder on the property? I'm talking about "your" mortgage lender. Is the "Balance when recovered" amount of $14,615 what "you" owe to "your" mortgage lender?
My head's spinning. 🙂
