Reporting sale of Duplex

[Will Dee]

I purchased a duplex Jan 2015 to live in and update. In October 2017 I sold the duplex. I ended up putting close to 40,000 in updates and repairs. I did not report the sale of the duplex on my taxes because I didn’t receive a 1099s and I believed because I lived in the house for greater than 2 years I’d be exempt from gains. I received a CP2501 stating I needed to report the sale of real estate. I am now not sure how to reply to this notice... do I write/ type up letter and mail it in with my response to the CP2501 then amend my tax return. Any advise is greatly appreciated.