I was a non-filer from 2000 to 2006, the same years I owned a rental property
I sold the property
in July 2006 and the IRS
just sent me a form
4549 which, of course, shows an outrageous amount owed.
I built the property in '99 and spent $200,000 cash (no improvements since).
In January 2000, I took out a small mortgage loan, about $100k.
the land which was valued at $150,000 at the time of the sale.
The property sold for $362,000.
Except for 2006, I've recently filed my late returns
but didn't include the depreciation
on the rental property from 2000-2005.
On my 2006 return, the year I sold the property, do I need to include the depreciation for each of those five years? How will the IRS calculate the depreciation recapture?