Single client owned a 2 family (1/2 rental) for 30 years. Stopped renting 5 years ago and left rental unit empty. I have deprecaiton schedule up to the period when she stopped renting. Sold property in 2022. How do I get the program to recapture the depreciation taken while a rental? If I enter the amount of depreciation taken on home sale worksheet, it doesn't seem to tax it at the 25% rate, simply lowers the basis. Any help is appreciated!
Thank you. My understanding is that depreciation recapture for the section 1250 gain is always 25%. In the past when doing sales, as long as I sold the assets on the depreciation schedule the 25% rate would populate. The program just does not seem to isolate that line on the home sale worksheet and separate it out for the 25% treatment; instead just taxing it all at the long term rates. Not sure if there is a work around or if I am not understanding the tax law. Thanks!
Thank you. I figured out that it was calculating the 25% rate on the section 1250 worksheet, but as you mentioned was not charging the 25% rate as per the schedule D worksheet on lines 35 through 40 Thank you all for your responses!
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