Reporting Mobil Home Sale on Second Home

[ChrisDIY]

In 2013, my wife and I purchased land that had a mobile home (classified as "real property") and an additional 3 bedroom "permanent build" bunk house attachment.  We are planning to sell the mobile home and replace it with build another "permanent build" house on the land.  This entire property (land and houses) is a second home.  Basis for the land and two houses was never individually determined, but I expect the sale of the mobile home component would be at a loss.  Is this sale required to be reported?  How will future sale of the entire property (land and 2 permanent houses), presumably at a gain, be handled regarding basis?  

[AmeliesUncle]

You first need to determine the individual Basis of the land and homes to allocate it between them.

Was it used for personal use?  If so, there is no need to report the sale if it was sold for a loss UNLESS you receive a Form 1099-S (look through the closing/sale paperwork, it is sometimes hidden in there).

If it was for business, rental or investment use, you may WANT to report the sale because you may be able to claim a deductible loss.

If it was sold at a gain, yes, you would need to report the sale.