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kcj1385
New Member

How do I get 2 depreciating improvements (orig cost) added to line 21 of form 4797 (p 2) - it is only showing cost (of home) plus sales expenses (commissions)?

Say the cost of rental was 100,000, added 2 improvements, new roof (5K) and sewer line (2k); they have gone through a couple years depreciating. Sold the home for 150,000 in 2017 (line 20, pg 2 4757). So cost, 100,000, plus other basis (5,000+2,000), plus 20,000 in commissions should be what pops up in line 21 of pg 2, 4757 or 27,000, but all I am getting is the 100,000 (home cost) + 20,000 (commission). Any help is appreciated. thanks

1 Best answer

Accepted Solutions
KittyM
Level 2

How do I get 2 depreciating improvements (orig cost) added to line 21 of form 4797 (p 2) - it is only showing cost (of home) plus sales expenses (commissions)?

You will need to "sell" the other two assets (the roof and the sewer line), as well as the house.  You will allocate a proportion of the sales price to each of these items.  Using your example:

  1. Allocate 100,000/107,000 (100,000 + 5,000 + 2,000) or 93.45% of the sales price/expenses to the house.
  2. Allocate 5,000/107,000 or 4.67% of the sales price/expenses to the roof.
  3. Allocate 2,000/107,000 or 1.88% of the sales price/expenses to the sewer.

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2 Replies
KittyM
Level 2

How do I get 2 depreciating improvements (orig cost) added to line 21 of form 4797 (p 2) - it is only showing cost (of home) plus sales expenses (commissions)?

You will need to "sell" the other two assets (the roof and the sewer line), as well as the house.  You will allocate a proportion of the sales price to each of these items.  Using your example:

  1. Allocate 100,000/107,000 (100,000 + 5,000 + 2,000) or 93.45% of the sales price/expenses to the house.
  2. Allocate 5,000/107,000 or 4.67% of the sales price/expenses to the roof.
  3. Allocate 2,000/107,000 or 1.88% of the sales price/expenses to the sewer.
kcj1385
New Member

How do I get 2 depreciating improvements (orig cost) added to line 21 of form 4797 (p 2) - it is only showing cost (of home) plus sales expenses (commissions)?

Thank you. Once I did the additional "sells" that created "2" additional properties, Property B and C - applying the 93%, 5% and 2% to the gross sale overall (150,000) provided the Property A, B and C gross sales price respectively. Very nice. I appreciate the assistance.
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