RECAPTURE RULES AND TAX PLANNING (2 OF 2)
01.Core Concepts
Charitable Contributions • If deduction is normally valued at FMV, must reduce deduction by amount of potential depreciation recapture. Installment Sales • Including SCINs and private annuities • Installment reporting provisions do not apply to depreciation recapture. • Recapture occurs when gain is realized. • Unrecaptured Section 1250 depreciation may be deferred, but all of gain in each installment year will be taxed at 25% until all straight- line depreciation is recaptured.