Suspend PAL and cap gains

[Allan C.]

I'm seeking clarification on activation of suspended passive losses upon sale of rental property. Let's use the scenario where my suspended PAL exceeds capital gains upon asset disposition.  

Does the total suspended PAL offset my ordinary income, and then asset sale capital gain get taxed at my capital gain income bracket rate - or does the suspended PAL offset the capital gains first, and the left over PAL offset ordinary income? I understand that i'll need to account for depreciation recapture separately. 

To take this one step further, let's take another hypothetical where i have suspended PAL for an investment asset that I dispose and 1031 to defer cap gains and dep recapture. In this scenario does the suspended PAL offset ordinary income, or does the suspended PAL carry over to the replacement asset?