Thanks for your response. I had to recapture the allowable depreciation. It does decrease the adjusted basis based on this IRS paragraph. 

"Generally, the law allows an annual depreciation deduction on your rental property and you must reduce the basis of the property by the amount of your depreciation deductions. If you don't claim some or all of the depreciation deductions allowable under the law, you must still reduce the basis of the property by the amount allowable before determining your gain on the sale of the property."

Are you referencing something else?