Depreciation recapture on vacation property
Home on Nantucket (sounds like a limerick doesn't it?) served as primary residence
and when Mom went into nursing home was put in Irrevocable Medicaid Trust.
Mom is still alive and kids rent out the house for a month every summer for 4 years only they don't report it on any tax return.
2018 the house is sold with a 4K loss on the rental portion. No depr taken.
Will they suffer recapture on the depreciation which could have been taken on the 4 vacation rental years?
I have read on this forum the recapture on 1250 property is the excess over straight line.
Question: as summer rental is this considered 1250 property and if depr never taken then there is no excess over SL, yes?
Would they do well to not even Sch E this one year?