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I agree ... seek professional assistance but you probably don't have a loss to deduct in fact you probably have a taxable gain if you have been reporting the rental properly on the Sch E and taking the required depreciation.

 

Basically the FMV is immaterial  ... you bought the home for an amount  + the cost to buy + any improvements made - depreciation allowed or allowable + cost to sell = adjusted cost basis   Selling price - adjusted cost basis = a profit or loss    If you have a profit then the profit less depreciation recapture (taxed as ordinary income) = capital gain taxed as cap gain rate.