CG Taxes On Investment Property
Last year I sold three investment properties that I had owned for about ten years. When calculating what I'll have to pay capital gains on, is it simply my sale price - (my purchase price+capital investments) = amount cg'S will have to be paid on? PAID 85K +2k of capital repairs and sold for 85K= loss of 2k? Or are there other factors?
Does the depreciation I claimed over the last 10 years come into play? I assume any capital expenditures(furnace or siding) which have been depreciated over the years, the balance will come off in full? Will my tax rate be 15%?
One more question, I have moved several times and can not find my original closing document for the purchase, any easy way to find out what I PD?
It appears, from the information you have provided, that you do not have any capital gains taxes on the sale of your property. However, you will have to deal with depreciation recapture. Even though this article was written before the capital gains tax rate was reduced last year, the depreciation recapture tax is unchanged at 25%.
How Depreciation is Recaptured tells you how to compute your depreciation recapture.
Does your county recorder or your state department of taxation and assessments have online records. If so, you should be able to log on and see the property history and your original purchase price. If not, then a visit to your county courthouse will yield the information you need.
Local real estate professionals sometimes have this information, and large metropolitan area newspapers sometimes have a phone number to call to get the same information.
How about the title company that conducted the original settlement? Call them and ask for a copy of the HUD-1 they have in their archives.
Thanks Dave! So it's not s much Capital gains that will get you, in this case it is the deprication that has been claimed over x number of years!