Reporting a loss on sale of primary residence but capital loss shows zero

[redmoose]

Hello,

Last year I sold a house that I owned since 2013 and used as a primary residence for 5 years. While waiting for real estate market to recover in this area house was either empty or partially rented out. Unfortunately, after several years there was no recovery in sight and I decided to sell the property.

Purchase price in 2013 was $936k, this is what I entered in adjusted cost base. Sale price last year was $752k, I have entered $725k as proceeds of disposition, taking into account realtor and lawyer fees associated with the sale.

However, TurboTax Online shows Federal Capital Gain/Loss as $0. Can someone explain what I did wrong here?

This is the first year I'm using TurboTax online version and I have to say I'm so disappointed at the limited functionality this has. 

Thank you

[Mike9241]

Sorry, but the loss on the sale of your personal residence is not deductible. 

[redmoose]

Hi Mike, thanks for the reply.

I think I need to elaborate a bit more on this property. In 2017 it was converted to a rental and at this time assessed value was still above purchase price, property assessment at this time was actually over $1mill but there was not a single house on the block that was selling close to assessed value. 

I have filled out the section where it asks how many years was it used as primary residence and how many years it was owned. Owned for 11 years, 5 of which as primary residence.

Does this still not qualify as a capital loss?

Thanks

[zomboo]

In general, if you sold your home at a loss, you can’t deduct this loss, but you don’t need to pay any tax on the money you received from selling your home. See Pub 523 Selling Your Home.

[tagteam]

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@redmoose wrote:

Does this still not qualify as a capital loss?

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Are you sure you even have a capital loss?

You mentioned $936k as your "adjusted cost basis" and that you converted the property to rental use sometime in 2017. Thus, did you factor in depreciation deductions (2017-2023)?

The accumulated depreciation will reduce your basis (which would be your actual adjusted basis for the purposes of the sale)?