Thank you very much for taking time answering my question, Turbo Tax Coleen. This is very helpful. I follow your answer in input to Turbo Tax, then go to Form 4797 p2 to review the number; the total gain in Line 24 has 30K more than my hand calculation. To make the discussion simple, lets assume the accumulated depreciation of the rental property over these years is 35K and I have 20K in sale closing cost and improvement.
By hand calculation
Form 4797: Line 20 Gross sales price (Note: See line 1 before completing.) : 275,000
Line 21 Cost or other basis plus expense of sale: 190,000 (i.e., 170K+20k)
Line 22 Depreciation (or depletion) allowed or allowable: 35,000
Line 23 Adjusted basis. Subtract line 22 from line 21. 155,000
Line 24 Total gain. Subtract line 23 from line 20 . 120,000
However, in Turbo Tax, after I put 30,000 for the cost of land, in Form 4797,
Line 20 Gross sales price (Note: See line 1 before completing.) : 275,000
Line 21 Cost or other basis plus expense of sale: 160,000 (seems to me: 170K+20k-30k)
Line 22 Depreciation (or depletion) allowed or allowable: 35,000
Line 23 Adjusted basis. Subtract line 22 from line 21. 125,000
Line 24 Total gain. Subtract line 23 from line 20 . 150,000
The total gain from Turbo Tax and from my hand calculation as 30K difference, that is the cost of the land. Is it anything wrong in Turbo Tax calculation or my hand calculation or some where?
