Investors & landlords

This will be a business loss reported on Form 1040 using Form 4797, Sales of Business Property.  Because the intent was to use half of the building for personal purposes, then you must split the payment and only half will be allowed as a business loss (or the relative square feet ratio- upstairs/down stairs).  You should have some documentation about reasons to move the business there and why you thought it would be good for business.

1. Entry in TurboTax:
   1. To enter the business portion: Other Business Situations > Sale of Business Property >Start or Revisit > Enter your sale.  
   2. The selling price will be zero and the cost basis will be the business portion of your cost 
   3. The date acquired will be the date you paid the money and the date of sale will be the date you no longer had a right to the funds
   4. See the images below for assistance.