Depreciation recapture on sale of rental property

Forum|Forum|3 months ago
April 9, 2026
1 reply
82 views

I sold a rental property that I own from an inheritance. The inheritance was in Jan. 2024 and sold in Nov. 2025. I entered all sales and cost info and TT seems to have correctly calculated loss in Part I. From research, I think there also needs to be be a calculation for tax on depreciation recapture that should be in Part III. TT did not complete Part III. How can I know if that is required?

PS - I paid $50 for TT phone support and have been connected with 'experts' - none of whom were able to assist with reporting a rental sale. I was told I would be connected with an expert which never happened. Is there a way to enter a support complaint?

AmyC

Level 15

You inherited in 2024 and sold in 2025. I am going to assume it was rented when you inherited it and you created a new Sch E for you using the basis at the time of inheritance. Because you held the property such a short time, a capital loss makes sense. The depreciation is part of the basis in the capital gain equation.

For example:

You inherited house worth $250,000 of which $50k was land value.
Let's say you depreciated the property for about a year about $7200.
When you sell the house, you don't list your basis as $250,000.
Instead your basis is $250k -$7200 =$242,800.
If you sold for $235,000 - you lost money and the depreciation is already accounted for.

If you sold for a gain, say $252,000, then the depreciation claimed would be part of your gain/recaptured.

You can contact support again to file a complaint and ask for a refund. To be really heard:

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If you are using TurboTax Desktop, you can also leave feedback at the Final Steps tab.

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