Sold rental property, Where do i report CCA recapture?

[milly101]

For over 10 years i claimed CCA on the property to offset the net profits and not take it as income. 

Now that we sold we have to report all that as income. But for the life of me i have no idea where i report this ??

[TurboTax_Susan]

You would enter the sale of your CCA items as dispositions, and then any recapture will be automatically calculated, if there is any. 

[milly101]

im not sure what you mean, in the CCA section there is the UCC for the building that as obviously reduced over the years as we claimed all net profit income as CCA.

When i click these have been disposed of, nothing happens

[TurboTax_Susan · Accepted solution]

Capital Cost Allowance is not income. It's depreciation for tax purposes - usually a deduction. 

A recapture of capital cost allowance (CCA) occurs when the proceeds from the sale of depreciable rental property are more than the total of both: 

the undepreciated capital cost (UCC) of the class at the start of the period
the capital cost of any new additions during the period

Your UCC will be negative, and you'll have to report this amount as income.

You not only check off the box in Area A, but you have to fill out the dispositions section (Area E & D on the T776 form).

[milly101]

my UCC start of the year is 556,000 , i sold the property for 1,353,000. If i add that to section E, it tells me i have to pay 498K in taxes ??

I looked back at all my tax years and manually calculated how much CCA allowance we took over the 10 years.

It was a total of 180K. The above method is not calculating that 

[TurboTaxBrenda]

On column 2 of the CCA table (T776), we should have 556K; then on column 5 he must enter the lower amount between the amount sold (1353K) or the original cost (556K+180K=736K), which is 736K. Then column 7 should be -180K, and that negative amount is the recapture shown on line 9947.

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