@Mike9241 wrote:
does that $60k thake into account the reduced basis due to depreciation? if the property is in a state with personal income taxes or you live in a state with personal income taxes, the taxation will vary.
Good reminders.
1. Your gain is taxable. Your gain is the difference between the selling price and the adjusted basis. The adjusted basis is what you paid, minus depreciation. Your gain might have nothing to do with the amount of cash you get, such as if you have loans on the property. And the part of the gain that is due to depreciation is always taxed first as recapture, before moving into the calculation for normal capital gains. (But, if you have no other income and are single, you could have up to $15,000 of taxable recapture and still not pay any actual tax.)
2. Most states do not have a special rate for capital gains and you will probably pay the full rate on your state income tax.
