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Updated over 2 years ago on .
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Bonus depreciation against with passive rental capital gain
I have question regarding bonus depreciation related to one transaction and the sales proceeds of a different property. I will use simple numbers for this question, assume everything transacts in the same year (2022), and that I am not a real estate professional -
Capital Gain from selling a single family rental - $100,000
Depreciation Recapture owed from single family rental sale - $10,000
Invest $100,000 as a limited partner in a multifamily purchase...this transaction is eligible for $100,000 bonus depreciation.
Question - can I offset my capital gain above completely if I take advantage of bonus depreciation? Would my only tax related liability from selling the single family rental then just be the depreciation recapture from that property?