Question: Please answer the above question and read carefuly! Five years ago, you purchased a small apartment complex for $1,000,000. You borrowed $700,000 at 12% for
Please answer the above question and read carefuly!
Five years ago, you purchased a small apartment complex for $1,000,000. You borrowed $700,000 at 12% for 25 years with annual payments. The original depreciable basis was $750,000 and you have used 27 12 year straight line depreciation over the 5 year holding period. Assume no capital expenditures have been made since acquisition. If you sell the property today for $1,270,000 in a fully taxable sale: What will be the taxes on sale? Assume 6% selling costs, 33% percent ordinary income tax rate, a 15% capital gains tax rate, and a 25% recapture rate
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
