Depreciation recapture on GOZONE property?

Question

I have a condo in GOZONE property and I'm considering electing the bonus depreciation. We plan on selling the unit within two years. What are the tax consequences of doing so, I know I will have to recapture depreciation to ordinary income, but does this include the bonus depreciation? Any help appreciated.
Thanks

Answer 1

The GOZ depreciation is not exempt from recapture. The tax consequences of electing the bonus depreciation are that you have less tax to pay in the year of purchase and are deferring that tax to a future year, when you sell the property. If your income is at least as high in two years as it is now, you may be paying more tax eventually by electing the bonus depreciation.