Paul depreciated his Florida investment property using the accelerated method and approximately $28,000 has been depreciated. He understands that it will be subject to "recapture" dollars when he sells it in October 2016, but is unsure of how much that will be. His investment property, a residential home that was previously used as commercial property, is currently appraised at $140,000, with annual taxes of $3,500 for non-homestead owners. He paid $110,000, the appraised value for the property in October 2004. Land records show that the .52 acre parcel (not the home) is appraised for tax purposes at $22,500. Had he used the straight-line method and depreciated $9,500.

a. the balance under the straight-line method would be carried forward.

b. the use of the ACRS would still have been permitted to be used simultaneously with the straight-line method, since the property was commercial property at one time.

c. the amount subject to recapture upon sale is $18,500

d. the IRS would recognize the accelerated method, provided recapture for the three highest years of depreciation while the property was classified as commercial is captured