Improvements/repairs to rental property prior to sale

[daveanthes]

I have a similar situation.  I bought a property with single wide in 2007 for $55,000.  We rented it out until 2018 when we took down the old house and put a new double wide on with a cost of $117,303.  We continued to rent it out after a few months it was down for construction.  Then in 2021 we sold the property for $184,000.  What form do we use to report the sale and appropriate gain/loss for our taxes.  I think its 4797 but it just doesn't fit the situation.

Thanks

Dave

[RobertB4444]

@daveanthes In TurboTax you will report the sale in the rental property section.  The system will walk you through all of the entries.

Here is a guide to entering rental property sales in TurboTax.

As far as the actual forms go, you will indeed report the sale of a rental property on form 4797 and it will carry over on to schedule D for the capital gains to pass on to your 1040.  

[Art67]

Thanks a lot - this step-by-step is super helpful! One problem though:

On the sales data entry screen, leave the "asset sales price" and "asset sales expenses" totally blank. Not even a zero in either of those boxes.

When running Federal Review TurboTax forces you to enter asset sales price in an empty cell.

What is a workaround?

[MarilynG]

Yes, if you sold Rental Property, you would enter the Asset Sales Price and Asset Sales Expenses.  Why would you think you would leave those fields blank?

If you can clarify your issue, we'll try to help. 

Click this link for steps on How to Report Sale of Rental Property. 

@Art67

[Landlady J]

Thank you for this guide.  I still would like to make sure I have this straight.  I bought a house years ago to flip because I watched too much HGTV.  It was finally placed in service Jan 1, 2019 as a rental.  My tenant left March 3, 2023.  Parts of the property were never finished until this year 2024.  The house was put on the market at the end of January and is currently under contract.  I have never lived in the house.  I have not filed the 2023 taxes yet but took the rental out of service as of 3/4/2023.  I will add the cost to finish it to the cost basis but not until 2024.  I calculated the rental expenses until 3/3/2023 and deducted them as such.  Can I deduct any of the electricity, heat, insurance, and interest between the time the tenant left and the time it will be sold?  It seems like I can't but then some answers are a maybe.  Thank you for your response.