Capital Gains Tax

[alylmoore]

We are selling a home we have lived in for 13 months because we inherited a home. We put a $50k down payment on our house. We are not looking to make a profit, just break even. We know we will pay capital gains tax on the profit we make from the sale. But do we have to pay anything on our equity? (The $50k down payment). 

[VolvoGirl]

Sorry.  The down payment and mortgage balance doesn’t figure into it.  Simply sales price - cost is the gain or loss.   

[alylmoore]

Thanks! That is good news to us. So if we sell for $475k and we bought for $450k. We’ll only pay taxes on that $25k? 

[rjs]

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@alylmoore wrote:

So if we sell for $475k and we bought for $450k. We’ll only pay taxes on that $25k? 

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Yes, that's right. And maybe less if you have selling expenses such as a broker's fee.