What is the Amount realized?

Amount realized is the total a seller receives from disposing of property, equal to money plus the fair market value of any other property or services received, reduced by selling expenses such as commissions, advertising, and legal fees. For a home sale, the amount realized is compared against an adjusted basis to determine the taxable gain, so a larger basis from capital improvements results in a smaller gain. Tracking this figure accurately supports the Sell your home strategy, because an overstated amount realized or an understated basis can turn an excludable profit into a taxable one at filing time.