Carl
Level 15

Deductions & credits

When you sell rental property, you *MUST* recapture *all* prior depreciation regardless of how you claimed that depreciation, and pay taxes on it in the year of the sale. Basically, the depreciation taken reduces your cost-basis in the property, thus making more of your gain taxable.

The recaptured depreciation will be taxed at a minimum of 0% and a maximum of 25%. The program will deal with it just fine.