In 2013,Tim sells Section 1245 property for $28,000 that he had purchased in 2007.Tim has claimed $5,000 in depreciation on the property and originally purchased it for $15,000.How much of the gain is taxable as ordinary income?

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Quizplus · Accepted Answer

Section 1245 property requires that all depreciation taken on the property be recaptured as ordinary income upon sale. Tim claimed $5,000 in depreciation, so $5,000 of the gain is taxable as ordinary income.

In 2013,Tim Sells Section 1245 Property for $28,000 That He