Rental Property Taxes

[RayT]

I have a rental property in AZ since 2012. Have it now but thinking about selling it. I put $$ into it for repairs and upgrades that I have previously deducted from my income. Will the IRS want to go back and calculate how much repairs and upgrades cost that I deducted from my income and collect taxes on that money.

[halpalms]

Repairs and maintenance expenses deducted in previous years are not recovered by the IRS when you sell your rental....depreciation deducted or allowed to be deducted is subject to recapture.

[RayT]

Wondering about the monies spent on remodeling specifically.

[halpalms]

The cost of improvements are added to your basis and decrease your gain.

[RayT]

So the improvements/remodeling costs are deducted from the gain of selling the property? Just want to make sure I got this right.

[halpalms]

You add those costs to your basis.....example = you paid $100k for the rental and over the years spent $30k in improvements and that makes your basis increase to $130k.