Get your taxes done using TurboTax

The rental activity is considered business property under IRS law in that it is reported as the sale of business property on Form 4797.  The advantage to you is that it obtains the same tax treatment as other business property sales that result in a loss.  The loss if fully deductible in the year of the sale or disposition.

In the depreciation section there will be questions about the sale information inside the entry of each asset (if you only have the house and land then it would be only one asset).

• Be sure to select the check box beside "the item was sold, retired, destroyed, disposed of..... (see the image below).
• Continue through the screens to enter the sales information (see the image below)