Depreciation Recapture

The built in obsolescence of many depreciable items as a result of fashion trends, technology marketing, and other factors over the last several decades has led to iconographic objects becoming emblematic of certain time eras, such as walkie-talkie-sized cell phones or word processors prior to the PC era from the 1980s.

In a strange twist, companies that may have not discarded such items, long past their depreciation value, have become sought after by prop masters of period-themed TV and film productions, and can once again yield marketable value that can easily exceed previous depreciated cost.

Depreciation recapture is incurred when an item is sold for a price above the depreciated cost, which equates to a capital gain. So if the cell phone had cost $1,000 and was depreciated to $300, but sold for $500 to a prop master, there would be a $200 capital gain subject to taxes.