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Asked by: Iliana Middermann
real estate real estate renting and leasingIs the sale of residential rental property section 1250?
Likewise, people ask, is Residential Rental Property Section 1250?
Section 1250 property - depreciable real property (like residential rental buildings), including leaseholds if they are subject to depreciation.
Similarly, you may ask, is rental property section 1245 or 1250?
If you sell Section 1245 property, you must recapture your gain as ordinary income to the extent of your earlier depreciation deductions on the asset that was sold. Section 1250 property consists of real property that is not Section 1245 property (as defined above), generally buildings and their structural components.
Segregating between the two provisions is not particularly difficult: Section 1245 assets are depreciable personal property or amortizable Section 197 intangibles; Section 1250 assets are real property, whether depreciable or not.