the repair and maintenance costs would go on schedule E. improvements would be added as an asset.
a) your gain selling price (1099 S which should match closing statement0
b) selling expenses - most those on the closing statement
c) cost of the townhouse, don't forget to put in what was allocated to land if it isn't there + improvements
d) depreciation
net proceeds = a less b
net basis = c less d
net gain = net proceeds less net basi
net gain less depreciation = long term capital gain
depreciation is recaptured as 1250 gain
even a large capital gain may not be hit hard with taxes. a portion of long term capital gain is taxed at 0%.
