talamtj
New Member

My primary residence of 2 out of 5 yrs was rented as loss for one year. Then, I sold and made $100k, do I still have to pay recapture taxes?

 

Investors & landlords

You must recapture the depreciation taken or allowed even if the Sch E ran at a loss  since you have a gain on the sale. 

Carl
Level 15

Investors & landlords

Rental property almost always operates at a loss "on paper". If sold at a gain, you will pay taxes on recaptured depreciation *no* *matter* *what*. Depreciation is not included in the 2 of 5 tax exclusion exception rule.