Depreciation recapture: what is it and how to avoid surprises #realestate

1.3K views9 months ago1m 11sScore: 78

Lydia Patel

Pricing & Profitability
beginner
Tax Strategy
Bookkeeping
Profitability
Expenses

Summary

This video explains depreciation recapture and how it affects the sale of a rental property. It uses an example to show how depreciation reduces the adjusted basis, increasing the taxable gain upon sale. The video also discusses strategies like 1031 exchanges or passing the property to heirs to avoid paying depreciation recapture taxes.