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A property is sold for $6,200,000 and the mortgage balance at the time of sale is $3,600,000. The property was purchased 5 years ago for
A property is sold for $6,200,000 and the mortgage balance at the time of sale is $3,600,000. The property was purchased 5 years ago for $4,820,000. Annual depreciation allowances of $140,000 have been taken. The tax rate on capital gains is 15% and the tax rate on depreciation recapture is 25%. What is the after-tax cash flow to equity associated with the sale of the property?
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