Calculating Your Taxes Due @ Sale (without a 1031)

Example (these are estimates and can change with respect to your situation):
Net Purchase Price: $500,000
-Depreciation: ($100,000)
+Capital Improvements: $25,000
=Adjusted Basis: $425,000
Net Sales Price: $1,000,000
Adjusted Basis: $425,000
Gain: $575,000
Taxes:
15% Federal X (Gain- Depreciation)
25% Depreciation Recapture Tax X Depreciation
State Capital Gains Tax X (Entire Gain not Less Depreciation)

Written by admin on December 20th, 2006 with no comments.
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DEPRECIATION: THE MYTHS AND PLANNING OPPORTUNITIES

You recover the cost of income producing property through yearly tax deductions. You do this by depreciating the property; that is, by deducting some of the cost on the tax return each year.
Three basic factors determine how much depreciation you can deduct. They are: (1) your basis in the property, (2) the recovery period […]

Written by admin on December 20th, 2006 with no comments.
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ACAT’s Year End Tax Tips

Written by Kerry M. Kerstetter, MBA~CPA~ATP~ATA on December 4th, 2006 with comments disabled.
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