Sale of commercial property reporting

[nagakota]

We sold commercial property for which we received seller's statement.  I am being proactive to determine taxes payable.  The property has building, land, improvements.  I divided up sale proceeds and costs proportionally among each item.

There is amortization too - the cost of refinancing, title, etc.  Do we report 0 for sale and cost of sale for amortization? That is what I did.  How do I know that the balance of amortization was written off?  Schedule E is not showing it.

Why does amortization show up as an asset - we would never sell that..

Thanks in advance

[TaxGuyBill · Accepted solution]

Yes, it sounds like you are doing it correctly.

The 'sale' of the amortized refinance costs is for $0, and that amount should show up on Form 4797.

It is listed as an "asset" because it is an item of value that you paid for, and the cost need to be spread out over a certain time period.  It may not be 'sold', but it is 'disposed' of when the property was sold.

[nagakota]

Thank you!