Hey all,
Not entirely familiar with depreciation recapture but understand the general concept (I think). I was just curious how it typically works in the situation that you've lived in a property for a number of years (not sure if this makes a difference but I co-owned the property at 25% with my parents at 75% and they gifted me their 75% portion in full, transferring/granting deed just a few months ago), then decide to rent it out for a year or two before selling. Does the depreciation recapture only apply to the last 1 or 2 years that you rented? So basically you would just claim deductions on the place for those 1-2 years and then when you sell you'd have to pay 25% (or whatever) on the total amount of deductions?
