I think your second computation correct
I do not understand why you bring up two long term cap gain rate.
1. the amount above purchase price, ie 100k=500k-400k, is subject to long term cap gain rate (20%);
2. the recaptured depreciation, $109,080, is subject to 25%.
That will be it.
1. the amount above purchase price, ie 100k=500k-400k, is subject to long term cap gain rate (20%);
2. the recaptured depreciation, $109,080, is subject to 25%.
That will be it.