Capital Gains Taxes
Hi. My husband and I bought a property in Missouri last year, fixed it up, and are renting it out as an MTR. We are now considering selling it. My question is: how is capital gains tax figured? We would like to decrease the amount we owe because we aren't going to do a 1031 exchange. Our mortgage is $95,000, and our renovation costs are spread over several different 0% interest credit cards. If we wrap those up into a $200,000 mortgage (which is what our realtor said it could now appraise for) before we sell it, would that decrease the amount of capital gains tax we owe at tax time? Any help or advice from those who have gone before would be greatly appreciated. Thank you!