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Business & farm
that is correct. regardless of when you sell it since it has a zero tax basis the proceeds are income treated as depreciation recapture - 1245 - ordinary income you'll see it on form 4797. if proceeds are less than the cost the recapture is the amount of proceeds not the $140K in depreciation you originally took. if proceeds are more, the full $140K is recaptured and the excess is treated as capital gain.
May 16, 2025
6:17 PM