@Ima_Audit_You I think depreciation recapture refers to treating a portion of the gain as ordinary gain vs. capital gain.
Sec 1245 (personal property) gain: treat as ordinary income to extent of all accumulated depreciation, remaining gain = 1231 gain (capital gain)
Sec 1250 (real property): accelerated depreciation in excess of straight-line depreciation is “recaptured” as ordinary income, remaining gain = 1231 gain (capital gain)
To answer your question, the “depreciation recapture” term applies always to Sec 1245 gains but not to Sec 1250 gains. Sec 1250 gains may not have a recapture in the later years when accelerated depreciation may be less than straight-line.
1231 gain just means that the remaining gain (not taxed as ordinary gain) is treated as a capital gain, so your question doesn't apply to this.
Anyone, feel free to correct me or add to this.
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