Long term capital losses - I sold a boat 2017 for a $100K loss. I need this loss to offset 2018 real estate gains. Do I need to list this boat on my 2016 return?

[nivramkrats]

I bought this boat 3 bdrm 2 bath boat in 2014, paid cash, so did not list as a 2nd home on 2015 & 2016 tax returns.  How do I show as a loss next year on my 2017 tax return. Do I need to revise my 2016 Tax return to show this boat?  Thanks, Marvin

[HelenaC]

You would report the sale of your boat in the year you sold it, however, if this is personal-use property, losses from the sale of personal–use property, such as your home, car, boat, or timeshare are not deductible. It is not eligible for the capital gains loss of up to $3,000 annually. For more information, see About Publication 523, Selling Your Home.. However, you have to pay taxes on any gain. 

For tax purposes, the sale of a "second home" is treated as the sale of an investment, whether you made any money or not. TurboTax Premier will help you enter the sales information. 

A vacation home can be categorized in one of three different ways: personal, rental, and dual purpose (mixed use). It all depends on the number of days used by the owner (or related parties) and the number of days rented.

The categories that determine the tax treatment of a property's income and deductions are:

• Entirely personal--property used as a home and rented fewer than 14 days in the taxable year.
• Entirely rental--property rented more than 14 days a year; owner's personal use does not exceed 14 days or 10 percent of the rental days, whichever is greater.
• Dual purpose--mix of personal and rental; property is rented for more than 14 days and personal use exceeds 14 days a year or 10 percent of total rental days, whichever is greater.

These are entered in the investment section of TurboTax. Follow these instructions:

• Open your return in TurboTax.
• (To do this, sign in to TurboTax and click the orange Take me to my return button.)
• In the search box, search for sold second home (use this exact phrase) and then click the "Jump to" link in the search results.
• Answer Yes on the Did You Sell Any Investments in 2016? screen.
• If you land on the Here's the investment sales info we have so far screen, click Add More Sales.
• Answer No to the 1099-B question.
• On the next screen, select Second Home (choose this also for inherited homes) or Land. Click Continue.
• Follow the on-screen instructions to completion.

Related Information:

• Is the money I made from a home sale taxable?
• Where do I enter Form 1099-S?
• I sold my rental property. How do I report that?