Home sale with home office and depreciation

[davelamx]

We sold our home this year after living there for 35 years and claimed home office and depreciation of $825 a year.  How are the taxes figured for the depreciation that we took?

[vithalanin]

I am assuming that the home office is within your home. Based on this, you do not have to allocate the gain between the business part of the property and the personal residence. You do not need to report the sale of a business asset. You do however need to pay capital gains tax on the depreciation taken over the years since May 6, 1997. The taxation differs between the simplified vs the actual expenses taken. As you have give the depreciation expense taken, you have used the actual expense method. If you have used the simplified method, then you will have no depreciation recapture.

IRS publication 587 gives you all these details. https://www.irs.gov/publications/p587

https://www.irs.gov/businesses/small-businesses-self-employed/simplified-option-for-home-office-dedu...