Does our daughter have to report a schedule E this year on a rental home she had with us if she filed a quitclaimdeed to us on the rental property last year?

[JillS56]

It depends, if your daughter had no rental income from the home in 2021, then she does not have to file a Schedule E for the income and expenses, but she should report that she no longer owns the rental property.   Because the rental property is considered an investment property, she needs to report that she disposed of the property.  Even though no money may have exchanged hands, it is treated as a sale.   If she gave the property to you by way of Quit Claim Deed, she needs to report the transfer.  To report the transfer/sale:

1. With TurboTax open enter sale of rental property in the search box.
2. Select Jump to sale of rental property in the results window just below the search box.
3. Follow the prompts to enter your rental sale information.

I Sold my Rental Property, How do I report it

Real Estate Tax and Rental Property

To make sure you report the transfer correctly, you really should seek professional tax guidance and legal counsel with respect to this transaction.

[davis_mc]

***Actually disregard.***

Hi,

Thanks for the information.  I am a little confused though. It seems obvious that the Schedule E is still there due to the depreciation aspects. But when I go through those steps and flag as the rental property is sold and go through the depreciation aspect with sold. It prompted for the date sold and all and says it puts the depreciation adjustment on the correct form. But I do back and look at all the forms - unless I am missing something there it no indication that the property was sold. I thought that would have been a form 4797 or 8949.

It is expected that going through the steps with the sold rental property on the schedule e - reporting no, income, no expenses, etc that at that there is no other form and no indication of the selling/disposing? 

[JamesG1]

Did you report a sales price on the quit claim sale?

Did you see the screen Sales of Business or Rental Property that states?

Your sale of property did not result in a gain.  Report here only sales of property you made a profit on.  We'll remove this sale now.

Generally a sale of rental property will report:

• The cost basis of the land under the rental property that is reported in Part I of IRS Form 4797, and
• The cost basis of the improvements on the land that is reported in Part III of IRS Form 4797.

[davis_mc]

Thanks!