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Level 15
Level 15

Investors & landlords

The amount of tax on the gain will depend on the net amount of the gain, your filing status, and also on your other income. If you also have any capital losses, or a capital loss carryover, that will reduce the taxable amount of the gain. There is also a slight, but unlikely, possibility that the amount of tax could be affected by changes in the tax law between now and when you file your tax return. Because of the number of factors involved, the only way to calculate the tax is to prepare a complete dummy tax return.


If you have the CD/Download TurboTax software you could prepare a dummy tax return as if you sold the property in 2021. It wouldn't be exact, but it would be pretty close. Anything you calculate now is just an estimate anyway. If you do this, don't modify the 2021 tax return that you actually filed. Start with a copy of your actual tax return, or start a completely new tax return, and be sure to save the dummy return with a different file name.

 

Don't forget that you will also have to pay state tax on the gain (unless you are in a state that does not have income tax). If you prepare a dummy tax return, do the state as well.