Question 1 - As per the advice from @HelenC12, yes, report the sale of your business domain on Form 4797. Form 4797 includes real, tangible property, but it also includes intangible assets, such as a domain name.
Question 2 - It is the best way because it is the only way you can report the sale of business property. Reporting the sale as other income would not be the way to report this sale.
Question 3 - You report the sale of your domain name in the Business Income and Expenses section (TurboTax CD/download) or in the Other Business Situations (TurboTax online). Whatever section applies to you, select Sale of Business Property, and enter your information. Don't use Forms mode if you can avoid it. Select Step-by-Step, upper right of your screen to go back to the section of TurboTax where you can enter your information.
Yes, HelenC12 works for TurboTax, as does GeorgeM777.
@EricDraven
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
