When reporting the the sale of former investment property, how to account for prior depreciation taken on the sale of that home? I think to add it to basis of the home and enter it on Line 18 of Form 8824. Is that correct?
Line 18 is the adjusted basis of the property given up. Subtract, not add, the depreciation from the initial basis of the property given up.
Then how to account for the depreciation recapture?
If the exchange is fully nontaxable there is no recapture.
