Capital Gains Tax

[Scrouch96]

I bought raw land back in April 2021. The purchase price was $190k and I put down $60k towards the loan at closing to being my load to $130k. We are now selling the land for $209k and I owe $108k on the loan. My question is once I get a check at closing (estimated to be $93k), do I pay capital gains tax on the $93k or can I subtract my original cash down payment from that and only pay taxes on $33k? Another question would be is there a write off for the mortgage and extra principal payments I made that brought my loan down to $108k?

[M-MTax]

In order to calculate your gain you need to subtract your adjusted basis from your sales price. The loan amount has nothing to do with that calculation.

[M-MTax]

If you paid $190k and are selling for $209k then your gain is $19k and you can subtract the likes of selling expenses and closing costs from that $19k gain.

There is no write-off for extra payments made on the loan. 

[Scrouch96]

That makes sense. I think I am over thinking it. I sold some real estate last year that I paid cash for and gained on the sale so I just didn't know if the mortgage effected anything. Thank you!