What Is Depreciation Recapture In SFR Investing?
Depreciation recapture is the taxable gain representing recovery of previously claimed depreciation deductions.
Depreciation Recapture is the amount of gain resulting from the disposition of investment property that represents the recovery of previously claimed depreciation deductions. Leftover boot in a 1031 exchange can result in a federal tax rate of 25% on depreciation recapture plus any applicable state taxes.
The information in this article is for educational purposes only and does not constitute tax, legal, financial, or investment advice. Consult a qualified professional before making investment decisions.