When Selling a Rental On Installment, Do I Avoid Depreciation Recapture? [Tax Smart Daily 043]

[@WillBockovenCRE]

Excellent content

[@mattcopley335]

Thanks -I was overpaying - On installment sale- I entered my straight line deprecation total also on form 4797 sec 26 by mistake. No I can spread it out a little.

[@SonlightNetworks]

Super helpful. Thanks!

[@303Estates]

Great Video!! It's a complicated subject, but you made it easier to grasp !! How can I consult with you on selling 3 building and not having to pay a ton in capital gain? Thanks!

[@khongcolong]

Great content. Thanks! If you demo on a white board, your viewers will follow easier.

[@TheRealEstateCPA]

Good idea!

[@brandonstone8756]

Great Video Thanks Brandon

[@lisanorman9638]

TY for your imformative Installment Sale podcast. I have an installment sale with multiple assets sold as a single sale. Do I have to prepare separate forms 6252 for each asset?

[@TheRealEstateCPA]

Good question. Technically, a separate form per asset. That may not be practical depending on how many assets.

[@hvpatel2]

You indicated that straight-line depreciation recapture (1250) is taxed up to 25%. Is it ever taxed at a lower rate. If so, what needs to happen for the lower rate to be applied?

[@thisisgettingdum]

It is taxed at ordinary income rates but is capped at 25%. If your ordinary income is less then 25% you pay less.

[@amandabuysllc8274]

The section 1245 gain... since that's on short term depreciable stuff (5-7 year lifespan), does that mean that after year 5-7, there is no recapture on those items?

[@TheRealEstateCPA]

There is still depreciation recapture when you sell on the 5-7 year property.

[@amandabuysllc8274]

@@TheRealEstateCPA why would you get recapture on 7 year lifespan items that you've owned for more than their lifespan?

[@int_rbmeetings1874]

Selling a rental property in 10 days in Florida. Question: If I buy another property as a 1031 exchange, rent it for 3 years, and then move into it for 2 years, then sell it, would I still have to pay capital gain taxes? Another question: For an 1031 exchange, let's say I am selling a property for $100,000 (no mortgage). I have closing costs, commissions ($6,000), etc. Let's assume the end result I end up with maybe $90,000. Is $90,000+ the amount I need to buy the new property for? Or do I have to come up with the difference (extra $10,000) and purchase a property for $100,000?

[@TheRealEstateCPA]

When you move into a rental, the period it was rented prior to you moving in is considered non-qualifying use for Section 121 (the cap gain exclusion section). So in short, you would still owe capital gains.

[@stevewang3498]

Love your videos, but this one was confusing. You need a dry erase board to write some basic things so we could follow you. Thanks!!

[@TheRealEstateCPA]

Appreciate the suggestion!