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     Sale of Property Report 
 
              ( See Report Below )  
 
  The sale of property report calculates a sale in each year 1 through 10 based on the investor's capital gains rate, unrecapture depreciation tax rate and the assumptions supplied for appreciation.   Before and after-tax Sales Proceeds are calculated for each year.  The after-tax sales proceeds value shows your profit from the sale based on the assumptions that were entered. To determine the investor's after-tax sales proceeds five years into the future, you would look at the year five data. 

It is best to be conservative when estimating appreciation.  High past appreciation rates don't guarantee high future appreciation rates.  Over estimating appreciation growth rates could greatly exaggerate your future gain from the sale.  You might want to enter low, middle, and high estimates for appreciation.  This will give you a range of estimates for future sales proceeds.  By using this approach, your actual future after-tax sales proceeds value should fall within the range.

Long term gains are profits from assets owned for more than one year.  If you are in a 25 percent income tax bracket or higher, your long term gains are taxed at 15 percent.  That portion of your gain attributable to depreciation is taxed at a higher rate.  Unrecapture depreciation taxes work like this.  The total of  all depreciation taken on the building during the period that you owned your income property plus all accumulated depreciation taken on any improvements to the building are subject to the following unrecapture depreciation tax rates when you sell.  If you are in a 15 percent income tax bracket or lower, a 15 percent unrecapture depreciation tax rate is applied to gains attributable to depreciation.  If you are in a 25 percent income tax bracket or higher, a 25 percent unrecapture depreciation tax rate is applied.

Any unamortized mortgage points not deducted on your yearly income tax returns and any carryover rental income losses not deducted can be taken when an income property  is sold.

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