Help with Sell of Rental Property - When the market had gone down, we held on to our property and rented it. We just sold it in 2015. How do we figure Capital Gains?

Forum|Forum|7 years ago
June 1, 2019
3 replies
40 views

We purchased the home in 2003 and tried to sell in 2007. The market crashed and we held on to it as a rental. The rent covered the mortgage, so we never made in income on it. We sold the home in 2016. Unfortunately, it looks like we have to pay capitial gains on it. How do we figure out the portion of the capital gain that we have to pay taxes on?

I don't know if this could help us. We have moved out the home we sold to our new home to take care of my elderly parents. When the market crashed, we were not able to sell and converted it to a rental so we would loose the house.

Thanks.

TurboTax Home & Biz Windows

Best answer by view2

The unknown is the basis you used for depreciation.

When you change property you held for personal use to rental use (for example, you rent your former home), you figure the basis for depreciation using the lesser of fair market value or adjusted basis.[separate land value ,land is not depreciated]

Depending on your circumstances you might want to seek the service of a CPA for the best tax reporting of your particular situation.

This sale has to be calculated two different ways to arrive at your actual gain or loss.