CalculateRealEstateROI

Taxes

What is depreciation recapture and what's the rate?

Tax on prior depreciation when you sell — capped at 25% for residential.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

Tax on prior depreciation when you sell — capped at 25% for residential.

Expanded explanation

Recapture often surprises sellers. Always model it into disposition analysis. 1031 defers; step-up at death eliminates.

Examples

  • $80k depreciation taken × 25% = $20k recapture at sale.

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