Investors & landlords

No, you do not need to separately report for the period it was used as a home. 

Yes, you can enter the sale one time in the 'Rental Properties and Royalties' section of your return. TurboTax will allocate the sale appropriately because it's a matter of the tax treatment of the gain.

If there were renovation costs that were done after rental activity finished and before the sale, they should be entered as sales expenses because you are not allowed to add an asset and remove it from service in the same tax year.  However, if you made capital improvements to the condo (remodel as example) while it was being rented, it should have been entered as another depreciable asset.  The tax law requires depreciation allowed or allowable which simply means use it or lose it.  It must be treated like you did take the required depreciation expense each year.  If this is the case then you should add another asset for the date the improvements were completed as placed in service.

If you have several assets on your condo rental here is an example of how to arrive at the selling price and selling expense for each asset.

Use the original cost of each asset listed on depreciation (or the current fair  market value), add those together then divide each one by the combined total to find the percentage of the cost for each asset.  Use that percentage times the sales price and sales expenses to find the selling price/sales expenses for each asset. (Choices would also be fair market value on the date of the sale or adjusted basis on the date of the sale, which is cost less depreciation.)

Example:  Original Cost (of each asset on your depreciation schedule)

$10,000 Land                = 13.33% 

$50,000 House              = 66.67%

$15,000 Improvements  = 20%

$75,000 Total                 = 100%

Multiply each percentage times the sales price/sales expenses to arrive at each individual sales price/sales expense.

It's not clear what the capital contribution paid to the condo association was for.  If it was required as part of the condo purchase you could add it otherwise it was personal expense before the condo became rental property.

You need to dispose of the property by telling TurboTax how and when it was disposed of.  Follow the instructions below.

1. Click on Wages & Expenses
2. Scroll to Rental properties and royalties, click Edit/Add or Start/Revisit
3. Do you want to review your rental?, click Yes
4. Under Rent and Royalty Summary, click Edit
5. Click Update to the right of Assets/Depreciation.
6. Do you want to go directly to your asset summary?, click Yes and Continue
7. Click Edit to the right of each asset to be disposed of/sold
8. Go through several screens until you get to Tell Us More About This Rental Asset
9. Click on This item was sold…….   And continue to answer the questions

You might also review information here.

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