Robert acquired his rental property in November 2004 for $110,000 and sold it in October 2014 for $230,000. The accumulated straight-line depreciation on the property at the time of the sale was $40,000. Robert is in the 35 percent tax bracket for ordinary income.

a. What is Robert's gain on the sale of his rental property?
b. How is the gain taxed? (i.e., What tax bracket is the gain subject to)?

Question

Robert acquired his rental property in November 2004 for $110,000 and sold it in October 2014 for $230,000. The accumulated straight-line depreciation on the property at the time of the sale was $40,000. Robert is in the 35 percent tax bracket for ordinary income.
​
a. What is Robert's gain on the sale of his rental property?
b. How is the gain taxed? (i.e., What tax bracket is the gain subject to)?

Quizplus · Accepted Answer

The Answer of Robert acquired his rental property in November 2004 for $110,000 and sold it in October 2014 for $230,000. The accumulated straight-line depreciation on the property at the time of the sale was $40,000. Robert is in the 35 percent tax bracket for ordinary income.
​
a. What is Robert's gain on the sale of his rental property?
b. How is the gain taxed? (i.e., What tax bracket is the gain subject to)?

Robert Acquired His Rental Property in November 2004 for $110,000