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If you've figured your "profit" correctly then that nets out to $34,000 after subtracting the improvements.
The sale is "short term" and will be taxed at your "ordinary" marginal income tax rates. I'm guessing, by your reference to "15%" and "$37,000" that you're filing "single" and expect to be in the second tax bracket, ordinarily. As long as that $34,000 profit keeps you within that bracket those dollars will be taxed - more or less - at a 15% rate. But if that $34,000 bumps you over the top dollar amount for the 15% bracket - $37,950 - those additional dollars will be taxed at 25%
Tom Young
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