Schedule E federal profit/loss

[taxuser2024]

I removed my Schedule E but I still get the requirement of filling in the federal/profit loss allowed during the transmit of efile. TT doesn't have an option to fill in that field. Do I need to start federal/state over again for it to work?

[AmyC]

Either you need to file sch E or there is nothing to enter. Have you tried zero? Can you clarify what is happening?

[taxuser2024 · Accepted solution]

Hi Amy,

I had a mistake in my previous post.

I have been using desktop (cd rom) windows turbo tax for around 10 years. I had a rental home in previous years that I moved back into a few years ago. For some reason (which may be due to incorrect usage on my part ), TurboTax from 2017-2022 was having me declare the rental as a $0 rental. But this year, when I went to transmit Federal and California, the checker told me to remove schedule E since the home wasn't being rented. I did that from the federal part of the taxes, but the California part didn't get that update automatically. So whenever I would try to transmit, the California check would ask me for an entry in the schedule e smart worksheet for federal/california "maximum loss allowed" (or something similar to that ), but that field wasn't one that tt was letting me fill in (I saw one or two other posts about having the same issue ). The solution was to go to File->delete state to delete California and start it again. Once I did that, TurboTax correctly removed the rental home from schedule e for California and the transmit went through. 

[AmyC · Accepted solution]

Wonderful news. However, since you moved back into a home that was a rental, keep track of the amount of depreciation taken and any unallowed passive losses for when you decide to sell the house. It will all come back into play and you still need to keep those records from when it was a rental.

Reference: Publication 551 (12/2022), Basis of Assets - IRS