Nonresident Pennsylvania rental property sale

[Tax2019Pay]

Dear Experts:

For nonresident of Pennsylvania who sold a rental property in Pennsylvania in 2022, one use PA-40, PA Schedule D and PA Schedule to report.  However, PA Schedule D column (d) only allows "gross sale price less expenses of sale" and column (e) only allows "cost or adjusted basis of the property sold).  Is there another form where the sale price and purchase price of the rental property can be reported?  Federal form 4797 allows this but Pennsylvania does not seem to have a similar form or worksheet to use.  Any advice?

[Vanessa A]

No, to report the sale of rental property in PA, you will only use Schedule D unless it is an installment sale, then you would use Schedule D-1.  

The gross sales price less expenses is just a condensed answer to report the actual amount you received from selling the property.  So if you sold it for $200,000 and paid commissions of $12,000 with no other expenses, then you would enter $188,000.  

Your cost basis is the purchase price plus any improvements or other capitalized items over the time you owned it. 

PA wants you to condense things instead of detailing them. If they have questions, they would then contact you.  

[Tax2019Pay]

Thanks. I have a follow up question about Pennsylvania Schedule D, line 1, column (e) Cost or adjusted basis of the property sold.  Does Pennsylvania Tax Return require depreciation recapture in the year when the rental property is sold?

[JosephS1]

PA does not technically require recapture of prior depreciation taken on rental property.  PA uses the adjusted basis for the cost of the property in the calculation of gain or loss on the sale.  The prior depreciation taken would be deducted from the original cost to arrive at adjusted basis for the calculation.

Below is a link for the instructions to preparing the PA return.  The information for the reporting of capital gains and losses can be found on Pages 31-33

PA Instructions

@Tax2019Pay