Here's how it works, but I'm not going to get into how the recaptured depreciation is taxed, other than you say it will be taxed at a maximum of 25%, even if your AGI puts you in a higher tax bracket.
First, the adjusted cost basis is determined by subtracting all depreciation taken from the original cost basis. That adjusted cost basis is this subtracted from your sales price to determine the gain.
Next, your carry over losses from IRS Form 8582 are subtracted from that gain to determine the amount of taxable gain.
iF that gets your taxable gain to zero (not common, but it does happen often enough) and you still have remaining losses to deduct, then those losses can be deducted from "other" ordinary income at a maximum of $3000 a year until all of those losses are used up.
