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Updated almost 7 years ago on . Most recent reply
Depreciation Recapture for Sale of Rental Home
I'm about to sell a house I bought for $290K in 2009 for $365K. We lived in it from 2009-2015, and have been renting it out the past 2 1/2 years - so we won't have to pay capital gains tax on the sale - since we pass the 2/5 year test and the $500K exclusion test.
But I'm confused on whether we will have to pay taxes on depreciation recapture (about $25k during the past 2 1/2 years). Do I have to count that as income? Will it affect my 2018 adjusted gross income?
Thanks for any help I can get!