Recapturing depreciation and filing taxes

[John Koontz]

My taxes are done each year by an attorney. When I got into rentals (we just closed on our 2nd SFR) the atty recommended we not depreciate the SFRs. His reasoning was that it wasn't worth having to recapture the depreciation unless we were sure we were going to hold onto them for a long time.

Based on the reading I've done, I'm getting the impression that we WILL have to recapture the depreciation regardless of whether we depreciate or not. Can anyone (specifically tax advisors or attorneys) confirm that this is the case? If so, I need to see about amending some tax returns. Or, if/when we sell, is there some statement or declaration we can make to the IRS and state treasury that we didn't depreciate?

Thanks for any input or advice.

[Paul Allen]

@John Koontz You got some really bad tax advice.

When you sell the property, adjusting the cost basis for the depreciation "allowed or allowable" is not optional. That means that even if you did not take all the depreciation you were allowed to take, you still have to adjust (lower) the basis for all the depreciation that was allowable. And THAT means you are going to pay "depreciation recapture" even if you didn't take the depreciation expense. 

The only rational tax strategy here is to take the depreciation expense every year.

Best of Luck getting this straightened out.