Question
sale of rental property
Greetings all:
Just looking for some reassurance. Never had to tell a client they owe over 120K between Federal and state. First I went into each asset and input the date of disposition. Next I checked box H that it was a fully taxable transaction.
Client purchased a rental property back in 1998 and never lived there. He paid 75,000 for the property and made 32,000 in updates over the years. The sale price was 550,000.
I calculated the gain on the sale as follows:
550,000 sales price
+ 73,864 depreciation recaptured
-75,000 cost of house
- 33,852 expense of sale
$515,012 gain on sale
