If we paid 130000 for commercial bldg in 96 sell in 07 for 350000 what is cap gain ttl? spent 50000 improving?

Answer 1

Several of the previous answers failed to take into account depreciation or suggested that it was an option. You would be required to reduce you base by the amount of depreciation that you could have taken whether you took it or not. A rough guess the depreciation would be in the area of $44K which would increase your gain to $214,000. You might want to think about some type of exchange sale to avoid the tax on that gain. Give the amount of money involved you should talk to a tax professional. While there are several here on this site they don't have all of the information necessary to make a complete answer.

Answer 2

Cap Gain= Sell Price - Cost - Cap Improve + Depreciation Taken

Answer 3

It is 170K - 50% (Cda) 30% (US) of which is taxable at your marginal rate. Assuming it is 25%, 85K x 0.25 = 21.25 you will owe to Uncle Sam. I used Cdn to err on the side of caution and to be conservative. This is tad high. You can reduce it even further with legal but innovative tax avoidance measures.

For e.g., Can you come up with expenses for advertising, improvement (if it is already claimed, you have to recapture and pay tax), depreciation etc..?

If you are paying high taxes because of this sale, consult an accountant. It is worth the money.

Answer 4

Cost basis 130 + 50 = 180
Net gain 350 - 180 = 170.

Now, if you took depreciation, it lowers you cost basis and raises your gain, talk to your tax person for final ans.

Answer 5

Sex, don't forget about the depreciation. For that building the standard live is 30 years, check with you accountant.

Answer 6

Simple math. Since it's an investment then you can apply the renovation costs.

350,000-130,000-50,000 = 170,000

Answer 7

Can you document the $50K? If so, you capital gains # is $170K

Answer 8

350,000-130,000-50,000=170,000.