re: Capital gains on home sale

just sold our home so went through this. improvements that you made can also be used to raise the cost basis. So in simple terms, say you put 50K into it, then basis is 550 (500 purchase + 50 improvements), your new net for tax purposes is 750, first 500K is tax free if you meet 2/5 rule as others state, so you get taxed on 250K, state and federal. Congrats on the gain. Of course your other income will impact your rate and how much of the 250k you lose, so I tried not to sell any equities for profit the year of the sale.