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Priya and Michael bought a house for $220,000 in 2014, added $80,000 worth of improvements, lived there until 2016 when they sold the house for

Priya and Michael bought a house for $220,000 in 2014, added $80,000 worth of improvements, lived there until 2016 when they sold the house for $390,000.

Calculate the profit on the sale of the house.

Is this profit a capital gain or income?

Is this profit taxable, or non-taxable? Explain.

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