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George Dimov — Page 32

Expert tax tips, accounting insights, and financial guidance from George Dimov, CPA — serving clients across all 50 states for over a decade.

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Can a long term capital loss carry forward offset the recapture of accumulated depreciation and capital gains on a property sale?

You can use a **capital loss carryover** to **offset a capital gain** from the sale of a building, potentially eliminating tax owed. Capital gain is calculated from the sales price minus the adjusted cost basis (original cost less depreciation). If the gain is fully offset by losses, there is no **depreciation recapture**. Long-term stock losses can offset depreciation recapture gains (unrecaptured Section 1250 gain), which is taxed at a maximum of 25%.

September 28, 2016Taxes5 min read

What is the basis of property received as a gift?

The basis for property received as a gift, such as a partnership interest, is determined by the donor's adjusted basis and the FMV at the time of the gift. If FMV < Donor's Basis: Use donor's basis for calculating a gain. Use FMV for calculating a loss. If both result, there is no gain or loss. If FMV ≥ Donor's Basis: Use donor's basis, adjusted for gift tax paid. For business property, use the donor's basis for depreciation.