This is part 4 of 5 in a series on Passive Activities. You can read the previous articles here: Part 1, Part 2, and Part 3.
Nothing, it seems, lasts forever, and it is likely there will come a time when you will dispose of your passive rental activity. When this occurs, there are a number of issues that arise. What happens to those suspended losses that were previously denied? What is adjusted basis? What is depreciation recapture? Is there a profit or a loss on the sale? How much tax will I pay?
We will attempt to clarify these issues in this article.
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