Hello,
Here is my situation.
I have a renal property. Rental - minus expenses - minus depreciation is showing a loss, let's say $5,000. Assume exactly 5,000 was my deprecation. Assume the same situation for three years, aka 15,000 loss due to depreciation+expenses.
Given that this is passive income for me and I am a high earner, I am not able to take losses against my income.
When I sale the property, and say if I gained 50K, how does the recapture works? I could not take loss against my income, so I assume I can get that money from the recapture tax.
That is,
Gain: 50,000
+Depreation recpature: $15,000
Total gain: 65,000
Minus: 15,000 (depreciation, which I could not take)
Total gain for Taxes: 50,000
Is this correct?
