[quote=AN]I wonder what would happen to the early depreciated taxes if the property is foreclosed. Would you still be taxed if you refi to the hilt, then the next time the market crash, you just mail back the key. In essence, you’ve already gotten your tax free gain out.[/quote]
Not sure, never went through that scenario because never considered getting foreclosed on…….But….If I were to guess, I’d think from a tax perspective, foreclosure would be considered a “sale”…. You would recognize capital loss from the sale itself, and you would have gain from the depreciation….Whether you owe taxes would depend on how you net…
Personally, after my kid grows up to a point, I think I would want to try doing is selling my primary home every 2-4 years if I have any reasonable capital gains…. And buy another one…. Assuming that tax benefit still exists…
