The basis for your home would be the Original Cost, not the refinanced purchase price.
Your Original Cost basis may be adjusted for various items after you acquired it such as:
- original cost, including sales tax, purchase expenses, commissions, etc. (from the original closing statement, if available)
- permanent home improvements
- nondeductible assessments for improvements (sidewalks, utilities, etc.)
- depreciation claimed or allowable (if you had an office in your home or rented the home)
- casualty and theft losses deducted
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