I lost an earnest money deposit (EMD) in a failed real estate transaction. I was trying to buy an investment property (rental house with tenants in it), which I was going to continue to operate as a rental property. I also spent $ on an appraisal and house inspection.
From what I read, the loss of the EMD is a capital loss and can be claimed in Schedule D. However, I don't see where I can enter this loss in Schedule D.
1. Can someone guide me through the steps for claiming the loss of my EMD as a deduction?
2. Where in Turbo Tax can I deduct the expense for the appraisal and house inspection?
in interview/step-by-step mode you'll come to a section for investments
you either click on add more sales
no to 1099-b
then check the box everything else
then you will come to a screen to enter the description and other info
then you can enter the amount it cost you
if you have a version that has forms mode instead you can type in 1099-B
and then click on the 1099-B worksheet
@Mike9241 My version of TurboTax has both step-by-step and forms mode. However, the help instructions below are abbreviated and I am not able to follow. I am a beginner using the software and I could use more detailed help. Thanks.
@ljzielke The loss would be reported on the LLC tax return and then reflected on the k-1 schedule that you receive from it.
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