Basis for capital gain on sale of rental property

[stephenrkg]

How do I calculate basis for a capital gain on sale of a rental property?  Specifically, what counts as a capital improvement?  Should I count any and all capital improvements in the property (anything that has increased the value of the property) over the last 34 years that I've owned it?  What if I made improvements to the rental property that I deducted from business income on the property at the time; can those still be used to increase basis?   (Obviously, depreciation and depreciation recapture is a different issue that I'm not asking about here.)  -- RS

[Critter-3 · Accepted solution]

All of these assets and improvements should be listed on your depreciation worksheet (even those that are fully depreciated) and all those items on the depreciation worksheet will be sold off.

[Mike9241 · Accepted solution]

it's what you originally paid including closing costs (unless you inherited the property) + the cost of improvements you capitalized (items that you expensed can not be added to the basis  - that's double dipping) from that you subtract depreciation allowed or allowable including that on the capitalized improvements. 

[stephenrkg]

Thanks to both of you.  Very helpful.