You don't need to amend a return to report the depreciation recapture. That will be handled when you report the eventual sale of the property. All it means is that you will deduct the depreciation allowable from the cost of the property when you calculate the gain on it's sale. So, you should have taken a deduction for the depreciation each year and then when you sell it you add all of that back into income. If you didn't deduct it, when you add it back it basically means you forfeited the deduction. Also, to the extent your gain is more than the accumulated depreciation, you pay ordinary tax up to 25% on that portion of the gain, as opposed to the sometimes more favorable capital gains tax rates.
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