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Updated about 6 years ago,

User Stats

64
Posts
16
Votes
Aaron Ingram
  • Rental Property Investor
  • Austin, TX
16
Votes |
64
Posts

No Capital Gains Tax, what about Depreciation recapture

Aaron Ingram
  • Rental Property Investor
  • Austin, TX
Posted

BP,

I may be missing something here but i'm looking at selling my first property as it has cash flowed minimally and I have held for appreciation, which it has done. The property was not purchased as an investment initially so it's time to move on. I have about 70K equity that i would like to roll into more cash flowing assets. My question is, I lived in this property for two of the last five years so i would incur no capital gains but I think depreciation recapture from three years of rental income, with a total depreciation of around 25K, would put a good dent in my earnings. Is it worth it to take the hit on this in order to have to time and breathing room outside of 1031 or would it be better to defer and use 1031 in this case? Any advice is appreciated

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