20 years ago, two other people and I purchased (equal shares) a rental property and in my tax return I incorrectly entered the asset cost at the full purchase price instead of at 1/3. After 5 years, I bought their portions of the property paying out more than the final sale price when the property was sold in 2022. To account for that, I entered another asset line for the full ownership payout. So, the sum of the two property asset items is very inflated. How can I correct that when filing my 2022 return?
Please note, the Schedule E forms were correct with the 33.33% ownership during the initial 5 years.
Also, there are several improvement assets, of which only 2 have remaining depreciation (kitchen remodel and flooring). When entering each "asset sale information", what should I enter in "sales price (business portion only)" and "sales expenses (business portion only)"?
i would suggest you use a pro. not only do you have to correct the cost but you also have to correct for the incorrect depreciation. this requires filing form 3115.
Please also address my other question, which was: Also, there are several improvement assets, of which only 2 have remaining depreciation (kitchen remodel and flooring). When entering each "asset sale information", what should I enter in "sales price (business portion only)" and "sales expenses (business portion only)"?
Do I have to enter #s for sales price and sales expenses in every asset item? How do I calculate the sales expenses?