ColeenD3
Expert Alumni

Investors & landlords

You will use the (sales price - minus basis + depreciation recapture) formula. The depreciation recaptured is taxed as ordinary income. There is no proration.

 

When you placed the asset in service, you were to use the lower of the FMV or Adjusted Basis on the date of conversion as your basis for depreciation. 

View solution in original post