Sure, gains above both the exclusion amount and the purchase price. But even when added to other sources of income that's going to yield a 1% income for very few people.
It will obviously be less than 1% of people overall.
Among the “got into the top 1% once” group, I think it’s possibly a majority of those cases.
Capital gains are roughly “net sales price minus basis”. Whatever the mortgage was has no bearing on it. (Someone who pays down their mortgage aggressively will not have more gains by that action, nor will someone who continually refi’s with cash-out have fewer gains.)
Edit: parent edited their comment to remove a question about how gains are calculated and how that interacted with mortgage payoff.
Editing a third time to point out that we're editing back and forth in real time. Your edit on the mortgage didn't exist at the time I deleted my edit about it. :)
Edit: And for those calculating all of this out to determine what percent of the population does fall into the top 1% from a home sale:
: If you have a capital gain from the sale of your main home, you may qualify to exclude up to $250,000 of that gain from your income, or up to $500,000 of that gain if you file a joint return with your spouse.
Among the “got into the top 1% once” group, I think it’s possibly a majority of those cases.
Capital gains are roughly “net sales price minus basis”. Whatever the mortgage was has no bearing on it. (Someone who pays down their mortgage aggressively will not have more gains by that action, nor will someone who continually refi’s with cash-out have fewer gains.)
Edit: parent edited their comment to remove a question about how gains are calculated and how that interacted with mortgage payoff.