An unincorporated business sold two warehouses during the current year. The straight-line depreciation method was used for the first building and the accelerated method (ACRS) was used for the second building. Information about those buildings is presented below. How much gain from these sales should be reported as section 1231 gain and ordinary income due to depreciation recapture by the owner of the business?

Question

An unincorporated business sold two warehouses during the current year. The straight-line depreciation method was used for the first building and the accelerated method (ACRS) was used for the second building. Information about those buildings is presented below.  How much gain from these sales should be reported as section 1231 gain and ordinary income due to depreciation recapture by the owner of the business?

Quizplus · Accepted Answer

Building No. 2 is considered Sec. 1245 property because ACRS was used. 11eac5e3_b10d_f01d_a396_737bec564496_TB5639_00

An Unincorporated Business Sold Two Warehouses During the Current Year