Clients ask me a lot of questions about capital gains and how it works. Please consult your financial planner or CPA for the best answer in your situation.  If you need a recommendation, please contact me.

To begin your understanding, here is a simplified calculation of how the capital gains is figured out for a property sale.  Several variables work into this calculation:

1. Sale price 
2. Current Tax Basis
3. Home improvements made 
4. If you own the property as a married couple or single person ($500k/$250K tax exemption)
5. Your income level/tax bracket

Read more about selling your home in the IRS Publication 523, "Selling Your Home"
If an original owner of the home is now deceased, please consult the Step-up Basis page to see if you can benefit from this tax law.