You have lived in that house for at least 2 years in the last 5 years. You are eligible for the capital gain exclusion for the sale of your home of $500,000 (married filing jointly or $250,000 (other filing statuses).
As you have rented the house in the last 1.5 years, you have to recapture depreciation allowable during the rental period and pay tax on it at the rate of 25%.
To report the sale of your home, follow these steps:
Edited 01.29.18 | 9:50 PM
At the end of that section it states "Be sure to enter your sales information in this section so we can calculate your capital gain or loss." However when I click edit it only asks for the date. No other info. Am I supposed to enter the details in the sale of home section?
As it is the sale of your home where part of the capital gain is excluded, you have to enter the sale in another section of TurboTax. Please delete the entries in the sale of rental home section and follow the steps above.
What about depreciation. Do I report the amount from last year's return and the amount calculated on this year's return?