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 » From: Kittery, ME Dear TaxMama: I have owned an investment duplex for 6 years. (I have never lived in the property) I understand the capital gains tax is 8% on the sale of such property. Am I right? Thank you Bob Dear Bob, Uh, no. You're wrong. Sort of. How much of a bet do you have riding on this? First of all, I don't know the rules for your state taxes. So, speaking only of IRS taxes: The depreciation recapture will be taxed at 25% The regular capital gain on the rest of the asset, held over 5 years, would be: If you're in the 15% bracket (after taking the sale into account) - 8% If you're not in the 15% bracket (after taking the sale into account) - 10% So, yeah, 8% does figure in there, somewhere. Does this help at all? Best wishes, Eva Rosenberg Your TaxMama  |
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