In 2003, I bought a property in New Jersey for $465,000 to use as a vacation home. I'm planning to sell it, and I think that I'll get around $685,000. I rented it out for several weeks the first year I owned it, but not since then. I have put money into it for renovations totaling $25,000. I currently make over $350,000.

How do I estimate my capital gains for 2014? Do I need additional information to estimate this? Have the laws changed since last year or are they about to change for 2015?


The laws regarding calculating the cost basis haven't changed in many years and I don't believe they're about to change now.

You add all your investments (including renovations, excluding maintenance and on-going repairs) and unclaimed losses, you deduct your depreciation (allowed or allowable) and rebates/refunds, and that's your basis.

About whether you could have/should have depreciate while the property was rented out - talk to a tax adviser (EA/CPA licensed in your state).

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