My husband and I are about to close on the sale of an out-of-state vacation home (never used as a rental, owned for 24 years), and our only income for the year will be the proceeds of the sale. Our profit will be about $400,000, after taking into account the original purchase price plus improvement costs over the years and sales costs. I believe we count the first $96,700 (married filing jointly) as regular income and the approximately $300,000 over that as capital gains. We will have the required 2% state withholding sent by the closing company to the state in which the property is located as part of our closing process, but I will need to send the IRS an estimate of our 2025 taxes based on our profit from the sale. Our effective tax rate on regular income last year was ~12%. I was planning to send in $55,000 to the IRS after closing next week. Does that sound reasonable?
