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virginiaTT
New Member

How do I allocate the gross proceeds from a rental condo sale between building and land ? TT Business asks amount received for " this building " : " this land ".

I received a form 1099-S that gives the Gross Proceeds in Block 2.  I need to know how to allocate this between building and land.

2 Replies
Critter
Level 15

How do I allocate the gross proceeds from a rental condo sale between building and land ? TT Business asks amount received for " this building " : " this land ".

When you put the asset into service and entered it for depreciation you had to breakout the land value from the total cost ... you can use the same % here.
Carl
Level 15

How do I allocate the gross proceeds from a rental condo sale between building and land ? TT Business asks amount received for " this building " : " this land ".

See if this helps.

Reporting the Sale of Rental Property

If you qualify for the "lived in 2 of last 5 years" capital gains exclusion, then when prompted you WILL indicate that this sale DOES INCLUDE the sale of your main home. For AD MIL personnel who don't qualify because of PCS orders, select this option anyway, because you "MIGHT" qualify for at last a partial exclusion.

Start working through Rental & Royalty Income (SCH E) "AS IF" you did not sell the property. One of the screens near the start will ahve a selection on it for "I sold or otherwise disposed of this property in  2016". Select it. After you select the "I sold or otherwise disposed of this property in 2016" you continue working it through "as if" you still own it. When you come to the summary screen you will enter all of your rental income and expenses, even it it's zero. Then you MUST work through the "Sale of Assets/Depreciation" section. You must work through each individual asset one at a time to report it's disposition (in your case, all your rental assets were sold).

Understand that if more than the property itself is listed in your assets list, then you need to allocate our sales price across all of your assets.  You will only allocate the structure sales price, you will NOT allocate the land sales price, since the land is not a depreciable asset.  Then if you sold this rental at a gain, you must show a gain on all assets, even if that gain is $1. Likewise if you sold at a loss then you must show a loss on all assets, even if that loss is $1

Basically when working through an asset you select the option for "I stopped using this asset in 2015" and go from there. Note that you MUST do this for EACH AND EVERY asset listed.

When you finish working through everything listed in the assets section, if you ever at any time you owned this rental you claimed vehicle expenses, then you must also work through the vehicle section and show the disposition of the vehicle. Most likely, your vehicle disposition will be "removed for personal use", as I seriously doubt you sold your vehicle as a part of this rental sale.


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