Re: How do I declare a second home purchase then s...
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How do I declare a second home purchase then sold for a loss

 
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Level 15

How do I declare a second home purchase then sold for a loss

If it is your personal primary home:

Enter your sale of your primary residence (which may require an upgrade in TurboTax), please follow these steps:

  1. Once you are in your tax return (for TurboTax Online sign-in, click Here), click on the “Federal Taxes” tab ("Personal" tab in TurboTax Home & Business)
  2. Next click on “Wages & Income” ("Personal Income" in TurboTax Home & Business)
  3. Next click on “I’ll choose what I work on”
  4. Scroll down the screen until to come to the section “Less Common Income”
  5. Choose “Sale of Home (gain or loss)” and select “start’
  6. You will want to use the "Easy Guide" to determine the adjusted basis on this home

Alternatively, to enter this sale of a second home in TurboTax Online or Desktop, please follow these steps:

  1. Once you are in your tax return, click on the “Federal Taxes” tab ("Personal" tab in TurboTax Home & Business)
  2. Next click on “Wages & Income” ("Personal Income" in TurboTax Home & Business)
  3. Next click on “I’ll choose what I work on” (jump to full list)
  4. Scroll down the screen until to come to the section “Investment Income”
  5. Choose “Stocks, Mutual Funds, Bonds, Other” and select “start’ (or “update” is you have already worked on this section)
  6. The first screen will ask if you sold any investments during the current tax year (This includes any sale of real property held as an investment property so answer “yes” to this question)
  7. Since you did not receive a 1099-B, answer “no” to the 1099-B question
  8. Choose type of investment you sold - select Second Home
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Level 15

How do I declare a second home purchase then sold for a loss

You don't need to report the sale of a 2nd home, that you sold for a loss; unless you received a form 1099-S**.

 

Although you have to claim (declare) a capital gain on the sale of your 2nd home, you are NOT allowed to claim a loss on the sale of  personal use property (e.g. 2nd home).

 

But, if your received a form 1099-S, the IRS will be expecting it to be reported on your tax return.  In TurboTax (TT) type> 1099-s, sale of property other than main home <in the find box. Then click "jump to". TT will report the sale, but disallow the loss, on form 8949, with a code L adjustment.

 

**Form 1099-S is usually included in your closing documents. Unlike other tax forms, it is not usually sent to you the following January.

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