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crUn3a
Returning Member

Rental Property Depreciation Recapture Qualify for QBI

Can the depreciation recapture from the sale of a rental property be used as income in calculating QBI?  I believe the depreciation recapture is treated as ordinary income, in which case it would be eligible?  However, I read that unrecaptured section 1250 gain can't be used in calculating QBI.

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4 Replies
DMarkM1
Expert Alumni

Rental Property Depreciation Recapture Qualify for QBI

You are correct on both questions.  The depreciation recapture treated as ordinary income is included in QBI whereas unrecaptured 1250 gain is capital gain taxed at 25% and not in QBI.  

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crUn3a
Returning Member

Rental Property Depreciation Recapture Qualify for QBI

I'm asking if the depreciation recapture from the sale of a rental property is ordinary gain or Section 1250 gain?  Therefore, can the depreciation recapture be added to QBI?

crUn3a
Returning Member

Rental Property Depreciation Recapture Qualify for QBI

Can the depreciation recapture from the sale of a rental property be used as income in calculating QBI?  This is my original question, can anyone answer it?

DMarkM1
Expert Alumni

Rental Property Depreciation Recapture Qualify for QBI

No.  The depreciation recapture portion for the sale of a rental property is section 1250 gain and therefore not part of QBI.

 

 

 

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