Sold rental Jan '18, $395K. Bought in Jul '10 as personal residence, $490K. Converted to rental Jul '12, FMV to start rental $450K. Passive Activity Loss. Where start?

[diane-steve]

Sold rental home in early Jan '18, $395K. Home was bought in Jul '10 as personal residence, $490K.  Converted to a rental Jul '12, and FMV to start rental was $450K (residence $300K, and land $150K).  I know the depreciation recorded on Schedule E which totals $74K to date.  My Passive Activity Loss Limitation (Form 8582), is over $$130K.  Where do I start entering the information into Turbo Tax? 

[diane-steve]

The home was not rented in 2018.  Does that change the recommended answer?

[Coleen3]

Yes If a property is not rented in the year of sale, enter the sale on Sales of Business Property.

[Coleen3 · Accepted solution]

Begin in the rental section if it was rented in 2018. You will encounter various screens where you can indicate the sale, the PAL and the depreciation. You will need to go through every category in rental to set it up. Please see the screen shot below for sale and PAL intitial entries.

Steps

Go into your TurboTax return.

1. Search for rentals and then click the "Jump to" link in the search result.
2. Answer Yes to the question Did you have any rental or royalty income and expenses?
3. Follow the on-screen instructions as you proceed through the rental and royalties section.

• We'll first ask you to enter general information about your rental (description, address, ownership percentage, etc.) 
• Eventually, you'll come to the Rental Summary screen which is where you enter your:
• Rental income
• Rental expenses
• Capital assets and depreciation
• Vehicle expenses

If you're also filing a nonresident state return to report income from an out-of-state rental property, be sure to complete your nonresident state return before you prepare your resident state return when you get to the State Taxes section.