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Investors & landlords
Thank you for your input.
No matter whether the rental property uses depreciation in the past or not, at the year when it is sold, capital gain = selling price -original cost basis of the property. Deprecation is not included with this formula.
The purpose of the recapture is to recover the adjusted cost basis due to man-made depreciation back to its original cost basis amount.
So there is no such a thing that recapture situation increases or decreases your original cost basis thus negatively increase your capital gain amount.
Please correct me if I am wrong.
‎August 15, 2024
5:17 AM