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Updated about 14 years ago on . Most recent reply presented by

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2
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1
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Bob Taurence
  • Real Estate Investor
  • Hopewell Jctn, NY
1
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2
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Exempt from Depreciation Recovery

Bob Taurence
  • Real Estate Investor
  • Hopewell Jctn, NY
Posted

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?

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15
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Tim Menius
  • Developer
  • Biloxi, MS
5
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15
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Tim Menius
  • Developer
  • Biloxi, MS
Replied

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.

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