Posted on: 12th Aug, 2010 05:43 pm
We purchased a property with a deserted shack from the state of Michigan for $3500! and replaces the cabin immediately for an additional $3,500. We are now selling for $12,000, what amount will be considered for capital gains
Welcome Guest,
The amount of profit that you make by selling the property will be subject to capital gains taxes. You bought the property for $3500 and will be selling it for $12,000. Thus, you would be taxed capital gains on $8,500 ($12,000-$3500).
The amount of profit that you make by selling the property will be subject to capital gains taxes. You bought the property for $3500 and will be selling it for $12,000. Thus, you would be taxed capital gains on $8,500 ($12,000-$3500).