For 2022 , Layla sells business assets and has total section 1245 depreciation recapture of $5,000 and a net section 1231 gain of $10,000. How will these two amounts be taxed? Both amounts are treated as ordinary income. The section 1245 depreciation recapture is treated as a long-term capital gain and the section 1231 gain is treated as ordinary income. The section 1245 depreciation recapture is treated as ordinary income and the section 1231 gain is treated as a long-term capital gain. Both amounts are treated as long-term capital gains