topic Where should I report the sale of a second home, that I previously rented, but didn't rent at all in 2018? I sold in June so I have taxes to enter for it also? in Investors & landlords

Where should I report the sale of a second home, that I previously rented, but didn't rent at all in 2018? I sold in June so I have taxes to enter for it also?

mandyd — Tue, 04 Jun 2019 01:05:22 GMT

If the last person to move out prior to the sale was a te...

Carl — Tue, 04 Jun 2019 01:05:24 GMT

If the last person to move out prior to the sale was a tenant, you'll report the sale in the Rental & Royalty Income (SCH E) section. Otherwise, if you converted the property to personal use on your 20"17" return *and* you were the last person to move out prior to the sale, you'll report the sale in the "sale of home (gain or loss)" section.

Did you live in it two of the past five years as your pri...

Coleen3 — Tue, 04 Jun 2019 01:05:25 GMT

Did you live in it two of the past five years as your primary residence?

Oh, the above assumes the last renter moved out in 2017 a...

Carl — Tue, 04 Jun 2019 01:05:27 GMT

Oh, the above assumes the last renter moved out in 2017 and not a prior year.

The renter moved out at the end of 2017 and I haven't liv...

mandyd — Tue, 04 Jun 2019 01:05:28 GMT

The renter moved out at the end of 2017 and I haven't lived there since 2013

Then you can report the sale in the Rental Income & Expen...

Carl — Tue, 04 Jun 2019 01:05:30 GMT

Then you can report the sale in the Rental Income & Expenses (SCH E) section of the program. Now while you will report zero rental income and zero rental expenses, due to a program quirk when asked for number of days rented, you can not enter a zero. Just enter a 1 to indicate it was rented for one day only in 2018. Then everything will work fine with the below guidance.

Reporting the Sale of Rental Property If you qualify for...

Carl — Tue, 04 Jun 2019 01:05:31 GMT

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 ahve a selection on it for "I sold or otherwise disposed of this property in 2018". Select it. After you select the "I sold or otherwise disposed of this property in 2018" 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 it it's zero. Then you MUST work through the "Sale of Assets/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. Likewise if you sold at a loss then you must show a loss on all assets, even if that loss is $1

Basically when working through an asset you select the option for "I stopped using this asset in 2018" 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.