Depreciation Recapture Explained in Austin, TX

Guides

Depreciation Recapture Explained

A plain language explanation of depreciation recapture tax for Austin investors selling depreciated commercial or residential rental property, and how a 1031 exchange defers this tax alongside capital gains.

Asset focus

Depreciated Rental PropertyCommercial Real EstateMultifamily

Challenges

  • Investors who have owned and depreciated a property for many years are often surprised by how large the recapture liability has become
  • Recapture is due even if the property sold for less than the original purchase price, as long as accumulated depreciation created a taxable gain on the depreciated portion
  • Failing to plan for recapture can materially reduce the net proceeds available for a down payment on a replacement property

What we deliver

  • A depreciation recapture estimate based on your property's cost basis and depreciation history
  • A side by side comparison of a taxable sale versus a 1031 exchange, including recapture exposure
  • Coordination notes for structuring your sale to defer recapture through a compliant exchange

Related services

Replacement Property Identification

Find replacement properties for your 1031 exchange

Forward 1031 Exchange Coordination

Coordinate standard forward exchanges

Reverse Exchange Readiness

Structure reverse exchanges

45 Day Identification Management

Manage identification deadlines

FAQ

How quickly can this service move in Austin, TX?

We begin the workflow immediately and keep stakeholders informed across Austin, TX.

Does this service cover markets outside Austin, TX?

Yes. We coordinate local partners so you can execute in any state while staying anchored in Austin, TX.

Who leads lender and Qualified Intermediary conversations in Austin, TX?

We coordinate with your lenders and Qualified Intermediaries, while reminding everyone that we are not a Qualified Intermediary. Every update references the exchange timeline in Austin, TX.

What documentation is delivered?

You receive organized summaries, letters, and trackers that make it easy to brief partners in Austin, TX.

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