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- Depreciation recapture occurs when12345:
- The sale price of an asset exceeds the tax basis or adjusted cost basis.
- An asset's adjusted sales price exceeds its adjusted cost (tax) basis.
- Depreciation doesn't accurately reflect the extent of an asset's change in value.
- A property is sold, and depreciation taken during its holding period is taxed.
- You sell a capital property and turn a profit after claiming depreciation deductions.
Learn more:✕This summary was generated using AI based on multiple online sources. To view the original source information, use the "Learn more" links.Depreciation recapture is assessed when the sale price of an asset exceeds the tax basis or adjusted cost basis. The difference between these figures is thus "recaptured" by reporting it as ordinary income.www.investopedia.com/terms/d/depreciationrecapt…Depreciation recapture is realized when an asset’s adjusted sales price exceeds its adjusted cost (tax) basis. Simply stated: on sale a portion of depreciated properties’ gain will be denied favorable capital gains treatment. That’s because a portion of that gain is the result of prior depreciation being deducted annually.propertycashin.com/resources/1031-exchange-dep…Sometimes, depreciation doesn't accurately reflect the extent of an asset's change in value. If you sell an asset for more than its depreciated value, then you'll typically have to pay depreciation recapture tax on any gain attributable to the depreciation.www.fool.com/knowledge-center/does-depreciatio…When a property is sold, depreciation taken during its holding period is taxed. This is called depreciation recapture. It can account for up to 25% of total depreciation taken.www.realized1031.com/blog/what-happens-to-a-de…If you own a piece of capital property like a real estate rental property, you can claim depreciation deductions on your annual income taxes. However, when you sell that capital property and turn a profit, the Internal Revenue Service (IRS) may levy a tax on it via a depreciation recapture.www.masterclass.com/articles/depreciation-recapt… - People also ask
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