KrisD15
Expert Alumni

Investors & landlords

You may have selected that you do not materially participate in the business or your investments in the business were not at risk. 

 

When you sell a business asset, the increase in value is Capital Gain, however the income attributed to depreciation recapture is ordinary income. 

So if you have an asset that you paid 50,000 for, depreciated 30,000, and sold for 60,000, you would have 30,000 ordinary income and 10,000 Capital gain.  

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