TaxGuyBill
Level 15
01-21-2022
06:25 PM
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Correct.
"Recapture" (based on depreciation in excess of straight-line) is taxed as ordinary income.
"Unrecaptured Section 1250 Gain" (based on straight-line depreciation) is a capital gain, but it is taxed at your ordinary rate, up to 25%.
And that is just for real estate (1250 property). For other assets ("personal property", 1245 property), all of the gain due to depreciation is "recaptured" (even straight-line depreciation).