Where do I adjust the cost basis of rental home that I sold in 2018 in which screen of Turbotax to increase the cost basis?

[mehditaghiei]

Should I just increase the purchase price on the screen that shows when I bought the house?

[Leonard]

No, you do not increase the sale price. You will enter the cost basis for your rental home on the page Sales of Business or Rental Property.  To access this page search for sale of rental property and select Jump to sale of rental property in the Top Questions box.  Continue to the page Sales of Business or Rental Property you will enter your cost basis in the box labeled Cost Basis 

[mehditaghiei]

Thank you for your fast response.  Turbotax Home and business does not have this page or I could not find it with the instruction given.  Please help.

[mehditaghiei]

When I go to this rental property there is a screen that asks if I sold this property and by saying yes and continuing on that screen there is a screen that shows the purchase price and date acquired ans also the cost of its land.  There is no place to adjust the cost basis.

[emidwife]

i am having the same issue - I can find where I sold it, enter purchase price but where do i enter /adjust purchase price to get the cost basis?

[Carl]

You do not, under any circumstances, change the cost on *anythjing* in the assets/depreciation section. If you do, you will completely screw up the depreciation and the entire depreciation history. That will make it "IMPOSSIBLE" to correctly report the property sale and practically guarantees you an audit 24-36 months after you file the return.

Generally, the only reason for using a different cost basis when selling the property, is because what you paid for the property was more than it's FMV at the time it was placed in service. So you *CAN* *NOT* report the sale in the SCH E section of the program.

First, work through the SCH E section of the program and start by selecting the option to indicate that "I sold or otherwise disposed of this property in 2019" and then press on through.

In the Sale of Asset/Depreciation section you have to work through each individual asset one at a time and on each individual asset select the option for "I stopped using this asset in 2019".  When asked for the date you stopped using it, enter the date that you closed on the sale. When presented the "Special Handling Required?" screen, you ***MUST*** select YES. If you select NO then you will be *FORCED* to enter sales data and you will *NOT* be reporting the sale in this section.

Once you have completed working through the rental property in it's entirety, go back to the "sale of assets/depreciation" section and work through each individual asset again. Do not change anything as you do this. Simply write down the numbers for each individual item for "prior depreciation" and "current depreciation". Once you've got all the numbers, add them together to get your total depreciation taken on the entire property and all of it's assets.  You will *NEED* that number later.

To report the sale, you will report it in the Sale of Business Property" section.

If you are using the Self-Employed or Home and Business version, it's under the Business tab.

If you are using any other version of Turbotax, it's under the Personal Income tab. Scroll down to Business Items and you'll find "Sale of Business Property" under that.

Just start working it through.

[macaspari]

Turbo Tax is broke.  When I go through each screen under sale of rental property just like the instructions, there is no place to add the cost basis and the program does not calculate passive activity loss carryover.  And I am using Premier Live.   Awaiting a call back.   Very frustrating.  

[macaspari]

I understand what you are saying above, the problem is that your helpful instruction is different than what Turbo Tax says in the sale of asset/depreciation section.   It very clearly states to report the sale information in "this section" section so that capital gains can accurately be calculated.   What I and other users have experienced is that the program does not allow you do that.   Now, your workaround to go to a separate sale of business section and report sale of a business is what I had to do.   But that section says report a sale that is not otherwise reported earlier.   So that's confusing.  Even had Turbo Tax rep on call and looking at my screen and she was confused and she elevated the issue.  Still waiting on call.   I went ahead and tried it while waiting and when I added a sale of business property, I had to enter all the information as if Turbo Tax could not connect the sale of the rental property as the same property.   I pad for Premier Live and this software is very disappointing.   All they had to do was add appropriate interview questions to the Schedule E part to address the sale, cost basis, and make clear to the user that we were getting credit for all the passive activity loss carryovers upon disposition of asset.   Will probably not be using Turbo Tax next year.   

[robnaro]

I followed your directions for sale of my rental property, but not seem to be getting a higher income amount and thus higher tax liability.  I converted our property to a rental home and the FMV was $160,000 at the time, yet paid $305,000.  I did as you said to use the Sale of Business or Property, but I must be doing something wrong as the amount showng as income for 2020 is $315,290.  Basically the cost was $305,000 and depreciation was $50,270.  There were $20,125 in selling costs.   what are the section 179 and 1231 losses?  I think I'm not getting those right.  My gain should be $85,145 or there abouts

[wfm2T]

That was the first helpful reply I've seen since I started using Turbotax 4 days ago.  And I've read 30 replies (my email tells me).  I really, really, really detest Turbotax.  There is no way that I've found to revisit sites to make changes.  Once it closes it's like it's in a vault and I certainly don't know the combination.  I have had to start the return over (3 times now) to get to enter the information correctly.  

My little addition if anybody reads it:  In the initial start when it asks what the sales price is it you are given a place to enter Expense of Sale.   To enter an accurate current Cost Basis of the property, subtract the initial depreciable amount from the current cost basis of the property and use that amount as Sales Expenses.