Sold rental property

[Skippy221]

Sold a rental property. I don't know how to fill this out.

Sales Information:

Enter the following information for your home sale. Allocate The sales price and any expense of sale between the asset and land based on the fair market value

Asset sales price____________

Asset sales expenses___________

Land sale price ____________

Land sale expenses___________

[ThomasM125 · Accepted solution]

Part of the sale proceeds has to be allocated to the house (asset) and part to the land. The same goes for the selling expenses. One way to do this is to add the cost of the land to the cost of the house and then divide the cost of the house by the total. Then use that percentage to determine the house (asset) and land portion of the sale.

For instance, say the land cost $25,000 and the house cost $75,000. The total is $100,000, and the house cost of $75,000 divided into the total gives you the house percentage of 75%. So, if the sale price is $200,000, multiply that by 75% (.75) and that means the Assets sales price is $150,000 ($200,000 selling price times 75%.) The land sale price would be the total sale price of $200,000 less the asset sale price of $150,000, or $50,000.

[Jerry1142]

For sale of a rental property, how do I allocate sale price and expenses to land vs asset? The sale was for both together with no breakout of land or asset separately. What is the common strategy used to determine the portion of the sale price for just the land?

[DoninGA]

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@Jerry1142 wrote:

For sale of a rental property, how do I allocate sale price and expenses to land vs asset? The sale was for both together with no breakout of land or asset separately. What is the common strategy used to determine the portion of the sale price for just the land?

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Land is never depreciated.  If you do not know value of the land at the time of sale then enter the same amount you used when entering the property as an asset.  The land value is usually shown on the property tax bill you receive from your county/city tax assessors office each year.