your cost basis is what you paid originally. in addition, you would add the cost of the generator if you capitalized it. if you expense it as a repair, it does not affect basis. for this example, I'll assume you capitalized it
you took depreciation of $135,300 through 12/31/2021. don't know whether this includes depreciation on the generator, it should if you capitalized it. if it does total basis is as follows
original cost 202995
generator 3500
total cost 206495
depreciation
2021 -135300
2022 - unknown but depreciation is allowed for 2022 based on disposal date 2/18/2022
the net is your basis
sales price is 204000
gain is difference between sales price and basis which will show up on form 4797 and be treated as 1245 recapture
the payoff of the loan has no effect on the gain.
