Rental Property Sale

[droneguy]

Hello,

I sold my rental property and received a 1099-S.  I entered the sale of the rental property, and Turbo Tax generated the loss based on expenses and passive carry overs.  However, should this also generate a schedule D to show capital gains loss?

Thanks!

[TerryA]

If the property sale resulted in a loss - and given there were no other transactions on Form 4797 - then it would be on Form 4797, line 18b, and from there to Schedule 1, line 4. It winds up as part of Form 1040, line 7a.

A Schedule D is not involved in that kind of transaction.

[droneguy]

Terry,

Thank you very much.  So, just so I understand, if the property sale was a gain, would it then be required on Sch D as capital gain or would the Form 4797 cover that gain as well on line 7a?

Thanks

[TerryA]

That's correct. Only because it was a trade/business loss it never wandered into Schedule D-Land. A gain would have sent it to Schedule D from the 4797 line 7.