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Home Cost Basis Worksheet to Calculate Capital Gains Tax

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Jason Chan
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How to Calculate Capital Gains Tax for Real Estate

Capital Gains Tax for real estate is pretty similar to capital gains tax you would pay on a stock if you sold it for more than what you bought it for. Effectively it is a tax based on how much profit you made on the transaction.

In essence, your Capital Gains is the proceeds from the sale of property minus the total cost basis.

If you would like to just use our free Subset spreadsheet template, click here. Below are steps on how to create your own or to help you follow along how our spreadsheet works.

How to calculate your total cost basis

The first thing to start with is to figure out your cost basis for the home. This home cost basis worksheet will help you figure out what you truly paid and put into your real estate property.

To calculate your home cost basis, take the home’s sale price when you bought it.

Then add any additional costs that you paid including transfer fees, attorney fees, and inspections.

Then, add the cost of any improvements you’ve made throughout your ownership of the home. This can include any renovation, room addition, adding a pool, adding a deck, adding a garden, etc.)

The total of these three number will be your total cost basis for your property.

How to calculate total proceeds from sale of property

To figure out what your total proceeds from selling your real estate property, take the amount you realized from the sale.

Then subtract out all selling expenses, which can include broker commissions, attorney or legal fees, title costs, broker commissions, and inspections. You can even include money you spent to fix up your home to prepare it for a sale.