Exempt from Depreciation Recovery

[Bob Taurence]

I was told by a CPA that my 15 year residential rental property will not be subject to 'recovery' since it was bot 2/08/84. It is fully depreciated. He said entire gain will be taxed at 15% cap gain rate. Is this correct? Having trouble finding it in the IRS pubs. Also, is it still considered Section 1250 property?

[Tim Menius]

Bob, As a CPA myself I can assure you that your CPA is correct. It is still 1250 property,but your placing it in service when you did pre-dates the ACRS and MACRS provisions. He is exactly correct. Recapture upon sale evolved as a result of accelerated depreciation provisions introduced by TEFRA 1986. Sell it and pay your 15% in good conscience.