Sale of Rental Property

[Mary J Yocum]

I sold my rental property in April of 2021.  I had income and expenses for those few months.  When TurboTax asked what did I do with the property, I clicked the I sold this property box.  I entered the rental information for those few months.  I have received a 1099-S.  Where do I enter that information?

[ThomasM125]

You need to enter the sales proceeds listed on your form 1099-S in the rental section of TurboTax.

You need to return to the rental section in TurboTax and Update the rental property, then Edit the property that you sold. When you come to the Review screen, Update the Assets/Depreciation section and choose to go to the asset summary. Once on the Your Property Assets screen, Edit the rental house asset and work through that section until you come to the Tell Us More About This Rental Asset screen. On that screen you should check The item was sold, retired, etc... box. Later in that section you will be asked to enter the sales price of the house and land. 

You should do the same for any other assets you have listed if they are not fully depreciated, and you will enter the sale amount for those as $0. 

[Mary J Yocum]

I went back through my rental property and entered the rent received, management and expenses, etc.  When the asset summary I clicked yes on the Did you stop using this asset in 2021.  In Disposition I entered the date I closed on the sale of the house,  in the Date acquired I used the date I bought the house in 1996.  On the topic Special Handling Required? I clicked yes.  It gave me a figure for the depreciation for the 94 days I owned the property.  I continued through all of the assets that had depreciation and clicked done.   I didn't understand the QBI Safe Harbor and clicked no. I didn't understand the Qualified Business Income and clicked no.  I clicked done on the Review Rental Income and Expenses, and that brought up the Rental and Royalty Summary.  That ended everything, and shows a loss.  I never got to the Tell Us More About This Rental Asset screen.  Nothing about the 1099-S came up.  What Am I doing wrong?

[PattiF]

No, you are not doing anything wrong with recording the sale of your rental property.

The QBI Safe Harbor election would treat the rental real estate as a trade or business for the QBI deduction. Since you did not select this in the past, No is the correct answer. Qualified Business Income (QBI) is the net income generated by any qualified trade or business. If you were actively involved with your rental property, you would qualify for this and answer Yes.

The amount on the 1099-S was entered as the sale price and doesn't need a separate entry.

Your software questions may have differed slightly from those posted as the questions have changed slightly in the past year.

[Mary J Yocum]

But I never entered the data from the 1099S. 

The 1099 shows gross proceeds of $30,000.
I only received $6851.11.

The difference is property taxes, settlement charges, and loan payoff - All totaling $23,142.89

Without those deductions, the entire $30k shows as income.  I need to know where to enter those figures from my 1099-S

[LoganathanB]

You have to enter the information under the sale of a business or rental property

You add real estate commission and any other expenses relating to sales paid by you to the cost of your property.

1. Open your return in TurboTax, search for rentals and then select the Jump to link in the search result.
2. Answer Yes to the question Did you have any income from rentals or royalties?
3. When you get to What are you here to report? select Rental property and fill out the description, address, and owner.
4. When you hit Tell us about your situation this year check the Sold box along with any other boxes that may apply.

The property tax and the loan pay off is what you owe and cannot be added to the cost of the property.

Form 1099S is an informational form that provides the gross proceeds to the IRS. 

The gross proceeds is what the rental sold for without any deductions.  

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Click on the link for more information

Sale of rental property

[Mary J Yocum]

Is there a phone number I can call for someone to help me with the sale of my rental property?

[FangxiaL]

Would you like to consider using TurboTax's full service? A tax expert will take over the work and all you need to do is to upload all your tax documents.

For more information, please see this help article What is TurboTax Live Full Service?.

@Mary J Yocum

[Mary J Yocum]

No thanks.  I've done all of our tax preparation except the sale of the rental property.  I use TurboTax because it pulls everything forward.  If you or someone else does the taxes, I will lose that capability.  I've bought this years TurboTax and can't get through this last item.  It'll be easier to go to a local tax preparer.

[Mary J Yocum]

I have gone back through my rental property.  I said I sold the rental property, but it was rented for 94 days.  In the depreciation section, I entered the date I sold the house on all of the assets that were still being depreciated.  Most of the assets had been completely depreciated.  In the house, the price I paid for the land and the house were already entered.  As I went through the house and each asset, I answered that the property had been sold, and that it was a rental.  TuboTax entered a loss for the 2020 tax year.  TurboTax didn't ask for any information about the cost of the sale of the house.  There was no place to enter the $30K from the 1099-S.  Do I enter that information somewhere else?  Do I enter the information under sale of a business or rental property?  I thought TurboTax would pull that information forward.  Please advise as to what I do now.

[Mary J Yocum]

OOOPS I meant 2021.

[Mary J Yocum]

Please finish the response.   To get the costs for the sale of the property, add that amount to the amount you entered for the 

For the what?

[JillS56]

I am sorry, I accidentally click a button, I was not finished with my answer.  I am finishing it. 

[JillS56]

No, you do not enter the information on the 1099-S elsewhere in TurboTax.  You were in the correct section to enter the information from the 1099-S, except that unlike most other 1099 entry screens the 1099-S does not have a box by box entry screen.  To get the costs for the sale of the property, add that amount to the amount you entered for the price you paid plus you can add the amount of improvements (See IRS PUBLICATION 527).  This is your Cost Basis and this is the amount that should be included as your answer to Cost Basis or the amount you paid for the property.

[Mary J Yocum]

I'm confused.  Am I adding the amount of depreciation recovered to the purchase price of the house?  Where do I enter closing costs?  Total proceeds were not $30K, which is what the 1099-S shows.  Part of closing was paying the loan off.  I'm sorry I'm taking up so much of everyone's time, but I need to get this sale right.  Can I take the depreciation deduction for the 94 days the house was rented?  It would be nice of TurboTax had a tax professional I could talk to.  I'd be willing to pay to have someone walk me through what needs to be done.  Is that an option?  I do not need my taxes prepared.  I just need to get the sale of my rental property in correctly.