How do I report a rental property that's been converted to a personal residence?

1. Log into TurboTax and open or continue your return.
2. Go to rentals.
3. On the screen Your 20XX rentals and royalties summary, select Edit (pencil icon) beside the property you need to work on.
4. On the screen [PROPERTY NAME] rental property info, locate Rental property info and select Edit (pencil icon).
5. On the Review your rental property info screen, locate the General info section, locate Situations, and select Edit.
6. On the screen Tell us about your situation this year, select Converted home to rental or rental to home and select Continue.
7. On the screen How was [PROPERTY NAME] converted?, select From rental to primary residence, and select Continue.
8. On the screen Was [PROPERTY NAME] rented every single day in 20XX?, select Yes or No according to your rental details, answer any following questions, and select Continue.
   • If you answer No, do NOT check the box I did not rent, nor attempt to rent, this property at all in 2024 as all information on this property WILL BE REMOVED from your return and can't be recovered.
9. On the screen Review your rental property info, select Looks good.
10. On the screen Here's [PROPERTY NAME] rental property info screen, locate the section Expenses/Assets (Depreciation) and then Assets. Locate your rental property and select Edit (pencil icon)
    • If you don't see your rental property listed under Assets, select Add expense or asset and follow the prompts to add it.
11. On the screen Your Property Assets, locate your property and select Edit (pencil icon).
12. Answer the screens according to your property details.
13. On the screen Tell Us More About This Rental Asset select the appropriate options that align with your property and select The item was sold, retired, stolen, destroyed, disposed of, converted to personal use, traded in, or given away (or it's no longer being used in this business for some other reason). Enter the date you stopped using the property for business use, and answer the remaining questions according to your property. Select Continue.
14. Answer the following prompts according to your property details.
15. On the screen Special Handling Required? select Yes.
16. On the screen Depreciation Deduction Amount, select Continue.
17. On the screen Your Property Assets select Done.
18. Note: Any vehicles associated with this property will also need to be converted to personal use. If you used vehicles for your property, continue following the steps below.
19. On the screen Here's [PROPERTY NAME] rental property info, locate the section Expenses/Assets (Depreciation), subsection Expenses and select Edit (pencil icon) beside the vehicle you need to adjust.
20. On the screen Vehicle Summary, select Edit (pencil icon) beside the vehicle you need to adjust.
21. On the screen Let's get some info about this vehicle review your details for accuracy, select the checkbox for I stopped using this vehicle in 2024.
22. In the prompt box Tell us when you sold, traded-in, gave away or stopped using this vehicle for your rental property, enter the same end date you used for the rental assets and select Continue.
23. Follow the prompts and answer according to your vehicle details.
24. On the screen Do any of these apply to the [CAR MAKE MODEL], select the checkbox for You started using it as a personal vehicle 100% of the time at any point in 2024, and select Continue.
25. On the screen Conversion to nonbusiness use, select Yes.
    • If you're still using this vehicle for another business/rental, answer No.

1. Select Search Topics. Search for and select rentals.
2. On the screen Income from Rentals or Royalty Property You Own, select Yes.
3. Answer any following questions regarding your property details.
4. On the screen Rental and Royalty Summary, select Edit beside the property you need to work on.
5. On the Review Your [PROPERTY NAME] Rental Summary, locate Property Profile and select Edit/Update
6. Answer any following questions regarding your property details.
7. On the screen Do Any of These Situations Apply to This Property? select the checkboxes that align with your property details and select I converted this property from a rental to personal use in 2024. Select Continue.
8. On the screen Was This Property Rented for All of 2024?, select No and enter at least one rental day for Days rented at fair rental price.
   • If you answer No, do NOT check the box I did not rent, nor attempt to rent, this property at all in 2024 as all information on this property WILL BE REMOVED from your return and can't be recovered.
9. Answer any following questions regarding your property details.
10. On the screen Your [PROPERTY NAME] Rental Summary, Locate Assets/Depreciation and select Start/Edit.
11. On the screen Depreciation for Your Rental Property, select Yes.
12. Answer any following questions regarding your property details.
13. On the screen Tell Us More About This Rental Asset, check any boxes that align with the details of your rental property and select The item was sold, retired, stolen, destroyed, disposed of, converted to personal use, traded in, or given away (or it's no longer being used in this business for some other reason). Enter the date you stopped using the property for business use, and answer the remaining questions according to your property. Select Continue.
14. Answer the following prompts according to your property details.
15. On the screen Special Handling Required? select Yes.
16. On the screen Depreciation Deduction Amount, select Continue.
17. On the screen Your Property Assets select Done.

Note: Any vehicles associated with this property will also need to be converted to personal use. If you used vehicles for your property, continue following the steps below.

1. On the screen Review Your [PROPERTY NAME] Rental Summary, locate the section Vehicle Expenses and select Start/Update.
2. On the screen Vehicle Summary, select Edit (pencil icon) beside the vehicle you need to adjust.
3. On the screen, Tell us about your vehicle, review your details for accuracy, and select the checkbox for I stopped using this vehicle in 2024.
4. In the prompt box Tell us when you sold, traded-in, gave away or stopped using your vehicle for your. business in 20XX, enter the same end date you used for the rental assets and select Continue.
5. Follow the prompts and answer according to your vehicle details.
6. On the screen Do any of these apply to the [CAR MAKE MODEL], select the checkbox for You started using it as a personal vehicle 100% of the time at any point in 2024, and select Continue.
7. On the screen Conversion to nonbusiness use, select Yes.
   • If you're still using this vehicle for another business/rental, answer No.

When you’re finished and have filed your return, be sure to save a copy of the following forms and TurboTax worksheets. You’ll need this historical information should you sell the property/vehicle, convert the property/vehicle back to business use, or when your heirs inherit.

• Form 8582 Passive Activity Loss Limitations (if you have passive loss carryovers)
• Depreciation and Amortization Report
• Alternative Minimum Tax Depreciation Report