Losses on the sales of second homes are considered personal capital losses. Unfortunately, personal capital losses are not deductible and you don't need to claim the loss unless there was a 1099-S issued for the sale by the title company.
If there was a 1099-S issued, you will enter the sales information in same section where capital gains from securities are reported. Follow this path in TurboTax:
- Go to the Federal Taxes category.
- Go to the Wages and Income subcategory.
- In the list of income items under the "Your Income" page, find the section labeled "Investment Income" and click Show more.
- Click start or revisit on the line labeled Stocks, Mutual Funds, Bonds, Other.
- Click yes, you did have a sale of an investment.
- Answer no, you do not have a Form 1099-B Broker statement.
- Choose the option for Second Home and click continue.
- Enter the Second Home Sale Information and hit continue.
- Indicate purchase method and hit continue.
- If the home had any business usage, indicate on the screen labeled "Any Business or Rental Use?" and hit continue.
- Enter the Cost Information and click continue.
- Assuming the home was personal use only, the program will indicate that no loss is deductible.
- If there was business usage, there will be additional questions.
