How to maximize tax benefits when refinancing & selling property?

[Ryan Fisher]

Looking to get some clarification in terms of refinancing my second property and that paying taxes part. Still trying to come to terms on maximizing tax benefits. (Not sure if I did properly on my first refinance and sell) 

I'm will use an example so to keep numbers simple but should still illustrate what I'm trying to get at. So with that, I: 

Buy property for $100,000
Down payment = $25,000
Mortgage = $75,000

36 Months Later: Property Has Appreciated
Property value now = $150,000

In which case I...
Refinance $30,000 out of the property
Making New Mortgage = $120,000

I then wait 1 more year to then sell property at $170,000.

So my questions is...When I sell do I pay taxes on the difference between what I originally bought and sold property so on the

$170,000 - $100,000 = $70,000 (What I pay taxes on?) 

Or do I only have to pay the taxes on the difference after that refinanced amount, being:
 $170,000 - $120,000 = $50,000 (What I pay taxes on?)

If it is that 2nd part option then that should beg the question of if I should refinance most of the value out of the property, tax free, before I sell the property so I only pay taxes on the little difference? 

Or is the only way to delay paying those taxes is to 1031 those profits into a larger property?