sale of primary resident with rental use

[martha2]

Client has a sale of primary residence that was converted to a rental.  The eligibility test is met so client may exclude loan per section 121 up to $500k, married filing jointly.  Is the depreciation recapture of the home taken while it was a rental charged against the basis or does it have to be taxed as gain on sale?

[TaxGuyBill]

The depreciation reduces the Basis.  And the gain from the sale that is due to that depreciation is taxable (it does not qualify to be covered by the §121 exclusion).

[martha2]

Thank you!