How to handle the partial sale of a rental duplex?

[mrfkl]

I've had a rental duplex (2 units in one building) for several years and always treated the duplex as a single multi-family property on Schedule E.  I've been depreciating the building for several years using Turbotax.

During 2024 (October) I sold 1 side of the duplex and kept the other side. 2 Questions:

1) How do I tell Turbotax (for Mac) that I sold 1/2 of the property so it can compute the depreciation properly?

They key question comes up when editing the depreciable asset in Schedule E that reads "Did you Stop Using this Asset in 2024?"  If I say yes, it assumes that I sold or disposed of the entire property, not just half.

2) I took the proceeds of the half duplex I sold and did a 1031 Exchange (with the purchase in 2025). I was issued a 1099 for the proceeds of the sale.  How do I handle the 1031 exchange in TurboTax (for Mac)?

Thank you.

[PatriciaV]

Before you enter anything, print all related forms and worksheets from your prior year return. Once you start this process, you'll lose access to some of the information you need to report the sale and set up the new rental correctly. See How do I get a PDF of my return?

1) Report the entire property as converted to personal use. Don't enter any sale information under the Rental Properties topic. Enter whatever income and expenses relate to the days it was rented before the sale.

2) Report the Section 1031 Exchange under Sale of Business Property using half the basis, value, and accumulated depreciation that represents the portion that was sold. Use Form 1099-S for the sale proceeds and selling expenses (if any). Search for "like kind" to find this topic.

Now set up a new rental property for the half you still own, using half of the basis & accumulated depreciation. Enter the original dates so TurboTax can accurately calculate depreciation. The "accumulated depreciation" is half the sum of prior and current depreciation from the Depreciation Report.

Enter the income and expenses that relate to the rental days for this portion after the sale date.