[[Many years ago I purchased a condominium for a rental unit. It is now fully depreciated. Am I correct that any proceeds from a sale would be fully taxable( since basis is now zero). ]]Well...you basis can NEVER be zero...since you are not allowed to depreciate the LAND under the condo. But assuming that you went ahead and depreciated the land, then you would be exactly correct that ANY and all sale proceeds would be taxable.[[If so would they be taxable at my marginal rate, or did I read in a previous post that the maximum rate for such a sale is 25%.]]It depends upon what type of depreciation that you originally took on the property. If you took the old ACRS depreciation on the fast track, then it is possible that your "recapture" will be taxed at your marginal tax rate. But if you used a straight line method, it is very possible that you "recapture" will be taxed at the 25% max rate.You can read more about this in IRS Publication 544 at the IRS web site.TMF TaxesRoyWant to learn more about taxes and investing? Then we have a deal for you!! The Motley Fool Investment Tax Guide is now available through Fool Mart. Be the first one on your block to own this masterpiece. It'll help you with your 1998 taxes, and it's never to early to start planning for your 1999 taxes. So just click on this link (http://www.foolmart.com/market/product.asp?pfid=MF+013+I) to read more about this amazing collection of tax information. (Apologies for the shameless plug…but it is a pretty good book…if I do say so myself). In addition, if you would like to visit the Taxes FAQ (Frequently Asked Questions) area, click on http://www.fool.com/school/taxes/taxes.htm and you'll be right at the home page. Check it out. Finally, if you need to get to the IRS web site, click on http://www.irs.ustreas.gov to go directly there.
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