If i sell for 337,000 and I owe 142,000 where do I deduct what I owe so I am not over 2590,000

[SweetieJean]

Sell what? Personal residence?

[TomD8 · Accepted solution]

You don't deduct it anywhere.  When you're calculating your capital gain from the sale of a home, the amount you owe on your mortgage is irrelevant.  Your capital gain is your net sale proceeds minus your adjusted cost basis.  Your adjusted cost basis is your original purchase price, plus the value of any capital improvements you've made to the property since your purchase (for example, a room addition).

See this IRS reference:  https://www.irs.gov/faqs/capital-gains-losses-and-sale-of-home/property-basis-sale-of-home-etc/prope...

[fanfare]

what did you pay to buy the house?. Probably more than $142,000 unless you've done a lot of cash-out refinancing

337-142 is 195. If you do not receive a 1099-S, you don't have to report this on your tax return.

[TomD8]

"If you do not receive a 1099-S, you don't have to report this on your tax return."
True - IF he qualifies for the capital gains exclusion.