My asset sales price was 77,900. Where do I put the payoff of the first mortgage loan (55638.31)? Thank you.
The payoff of the mortgage does not go into the calculation of gain or loss in terms of taxable income.
Expenses of sale (repairs, closing costs, etc.)
Your basis (Purchase price + costs + improvements)
This calculation is how you determine gain/loss on sale. The mortgage amount does not matter.