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BD55
Returning Member

Rentalproperty

Does this refer to actual sale of the rental property itself or to the equipment used for the property

Assets/ Sale of Property

Track the property you use in your rental in this section. Here you can:

- Enter property purchased for rental
- Enter the sale of your rental
- Enter new assets used in your rental like refrigerators, or water heaters
- Enter the sale of an asset or a rental
- Track the allowable deduction of points paid in a refinance.

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3 Replies
Carl
Level 15

Rentalproperty

Does this refer to actual sale of the rental property itself or to the equipment used for the property

If by "this" you are referring to the section of the program called "Rental & Royalty Income", that section is for reporting any and all income and expenses directly associated with rental income. Can you be more specific on your specific situation, as to why you're asking this question? Basically, the quality of the answer is directly proportional to the clarity of the question.

If on the rental summary screen you are seeing "Assets/Sale of property" instead of "assets/depreciation" that indicates to me that you selected an option box on an earlier screen that reads something like "I sold or otherwise disposed of this property in 2020".

So what's up? Did you sell it? Give it away? Maybe it was completely destroyed in a natural disaster or fire?

 

BD55
Returning Member

Rentalproperty

We sold the property in august of 2020

Carl
Level 15

Rentalproperty

Here's the basic guidance on reporting the sale of rental property. I am assuming that the property was occupied by a tenant at the time of the sale, or that the last occupant to vacate the property prior to the sale was a tenant, and not you the owner.

Reporting the Sale of Rental Property

If you qualify for the "lived in 2 of last 5 years" capital gains exclusion, then when prompted you WILL indicate that this sale DOES INCLUDE the sale of your main home. For AD MIL personnel who don't qualify because of PCS orders, select this option anyway, because you "MIGHT" qualify for at last a partial exclusion.

Start working through Rental & Royalty Income (SCH E) "AS IF" you did not sell the property. One of the screens near the start will have a selection on it for "I sold or otherwise disposed of this property in  2020". Select it. After you select the "I sold or otherwise disposed of this property in 2020" you continue working it through "as if" you still own it. When you come to the summary screen you will enter all of your rental income and expenses, even if it's zero. Then you MUST work through the "Sale of Property/Depreciation" section. You must work through each individual asset one at a time to report its disposition (in your case, all your rental assets were sold).

Understand that if more than the property itself is listed in your assets list, then you need to allocate your sales price across all of your assets.  You will only allocate the structure sales price; you will NOT allocate the land sales price, since the land is not a depreciable asset.  Then if you sold this rental at a gain, you must show a gain on all assets, even if that gain is $1 on some assets. Likewise, if you sold at a loss then you must show a loss on all assets, even if that loss is $1 on some assets.

Basically, when working through an asset you select the option for "I stopped using this asset in 2020" and go from there. Note that you MUST do this for EACH AND EVERY asset listed.

When you finish working through everything listed in the assets section, if you ever at any time you owned this rental you claimed vehicle expenses, then you must also work through the vehicle section and show the disposition of the vehicle. Most likely, your vehicle disposition will be "removed for personal use", as I seriously doubt you sold your vehicle as a part of this rental sale.

 

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