What is depreciation recapture?

[Megan Hirlehey]

Hi BP. I keep seeing the term “depreciation recapture” pop up in my research, and it sounds like a b!tch. How exactly does it apply to real estate investing and on what types of real estate deals would you encounter it (flips, buy and hold, wholesale, etc)? I’m just trying to learn more about if it is something I’ll likely encounter in my strategy of mostly “buy and hold” and how to plan for it. Thanks!