I purchased a second home for 85K and invested about 50K to rehab it 3 years ago. It appraised for 165K but I have an offer for 157,500 with 7,500 towards their closing costs. What are my tax implications? I am married, filing jointly, sold primary home on 4/2015. Moved and no longer live in the US since 1/2015 and have residency here but am still a US citizen. I am 61 and spouse is 55.
Looks like you will owe Long Term Capital gains on the $15,000 gain. 2015 Long Term Capital gain rates are based on your tax bracket.
$157,750 - $135,000 - $7,500 = $15,000
You might owe tax on primary home if you gain was more than $250,000.
Hope that helps.