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From: alex@rruxc.UUCP (A DeSimone)
Newsgroups: net.invest
Subject: Re: Re: Mortgage Down Payments and Good Investments
Message-ID: <126@rruxc.UUCP>
Date: Tue, 26-Nov-85 09:22:56 EST
Article-I.D.: rruxc.126
Posted: Tue Nov 26 09:22:56 1985
Date-Received: Wed, 27-Nov-85 06:23:07 EST
References: <1439@decwrl.UUCP> <20@pixdoc.UUCP>, <886@terak.UUCP>
Organization: Bell Communications Research, Piscataway, NJ
Lines: 21

> I believe that one simply has to buy a home costing as much as
> or more than the sale price of the one that was sold. I don't
> think the cash realized has to be invested in the new home. I
> could, however, be wrong.

> Suzanne Barnett-Scott
> uucp:	 ...{decvax,ihnp4,noao,savax,seismo}!terak!suze

I don't think that's right.  My understanding is you pay capital gains tax on:
(sale price of old house)-(purchase price of new house)-(cost of improvements)
That is, if you buy a home for less that the one you sell, you can deduct the
cost of any home improvements you made on the old house from the profits but
Uncle Sam gets a bite of what's left.
-- 

Alex DeSimone, Amala Consultants @ Bell Communications Research
UUCP: ..!{ihnp4,allegra}!rruxc!alex
USMail: 444 Hoes Lane, Room RRC 4B-313, Piscataway, NJ  08854
MaBell: (201)699-4438

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