My ex-tenant has large rent arrears that I hope to get paid in the next year or two. I carry significant disallowed PAL. I am selling my only rental but would like to postpone using the disallowed PAL for when the tenant pays. Is there a way to do it?
No. Unpaid rent is not reported anywhere on any tax return. It has absolutely nothing to do with your sale of the property in any way, shape, form or fashion.
More generally, how to treat/offset future rental income that is received after the rental has been sold?
You just report it as "other income".
Is there a way to offset it with the losses incurred during the tenancy?
There's absolutely nothing to offset. Since you don't report rental income not received, you don't pay taxes on it. Therefore, you have nothing to report or account for.
And similarly, is there a way to deduct expenses that are associated with the rental but take place after the rental is sold?
No. Once you no longer own the property, you're done with it. Now if you're talking about concessions to the buyer, that's dealt with as a part of the sales transaction. But once the property is sold, you're done with it in all aspects, forever.
As for your PAL carry overs, those will be fully deductible against all other income, in the tax year you sell the property. So your carry over PALs will not be lost. Generally, those will help offset the amount of taxable gain, as well as the taxation of the recaptured depreciation.
One thing I not is that you refer to "EX" tenant. I assume this is a tenant you either evicted or they left of their own accord, and that you "DO" still have a renter in the property that took up residence after the non-paying renter vacated.
