The cost basis would increase by 10k with the improvement resulting in 110k. The 6k of depreciation would then decrease basis resulting in 104k. When sold at 180k there is a gain of 76k. The 6k would be considered unrecaptured 1250 gain subject to the higher capital gains tax rate of up to 25%. As for the refinancing fees, any amount not amortized will be added back into your cost basis, reducing your gain when you sold the property.
