Business sold on installments

[AZ-Tax]

This person first became my client for 07 tax year which happen to be his first year in his new Sch C business. In 07 he had about $51K of sect 1245 property depreciated over 5 yrs. In 08 he sells the same business for $170K on an installment plan. Some how I would think the amt of depreciation he took in 07 and part of 08 needs to be recaptured. If so just how exactly is it done. I use ProSeries software.

[Burke]

First, determine how the sales price is broken down. How much was furniture and equipment, how much was bldg, how much was goodwill, how much was inventory, etc. Then calculate any recapture on 4797 for depreciable assets.