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dempseyjeremiah
New Member

Tax rate on Section 1250 (unrecaptured depreciation)

Can someone clarify what the tax rate is on unrecaptured Section 1250 depreciation? I have read that it is a flat 25% (like the flat 0,15 and 20% capital gains rate) but I also have read that it is up to a maximum 25%, ie not a flat 25%. I consulted with two accountants who gave me conflicting answers.
Title 26, Section 1(h)(1)(E) seems to support the flat rate but I am not sure if I am interpreting this correctly.
1 Best answer

Accepted Solutions
TaxGuyBill
Level 9

Tax rate on Section 1250 (unrecaptured depreciation)

It is up to a maximum of 25%.


I agree that both §1(h) and the Schedule D worksheet are mind-bending, that is how it works.

https://www.irs.gov/pub/irs-prior/i1040sd--2015.pdf#page=15

https://www.law.cornell.edu/uscode/text/26/1#h


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2 Replies
TaxGuyBill
Level 9

Tax rate on Section 1250 (unrecaptured depreciation)

It is up to a maximum of 25%.


I agree that both §1(h) and the Schedule D worksheet are mind-bending, that is how it works.

https://www.irs.gov/pub/irs-prior/i1040sd--2015.pdf#page=15

https://www.law.cornell.edu/uscode/text/26/1#h


View solution in original post

dempseyjeremiah
New Member

Tax rate on Section 1250 (unrecaptured depreciation)

Thanks!
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