I bought a rental property in 2012 and sold it on 2015. Every year, I have been showing a depreciation loss. The combined depreciation I have deducted is around $7000. However, after I have sold the property, the unrecaptured gain (Section 1250) is calculating the depreciation to be around $10,000.
The tax-calculated depreciation ($10,000) is higher than the actual depreciation ($7,000) that I reported. Based on the forumal, the $10,000 is correct, which means I have under reported my depreciation. How do I rectify this? Can I modify the $10,000 to $7,000?
Thanks for all the help.