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Reporting the sale of home used as a rental property in Lacerte

SOLVEDby IntuitLacerte Tax86Updated September 27, 2021

This article will help to report the sale of a home that was used as a rental property, that had been rented in the year of the sale, and the taxpayer had lived in the home for at least 2 of the last 5 years:

If the asset is entered on Screen 22, Depreciation:

  1. Go to Screen 22, Depreciation.
  2. Select the applicable Asset from the left panel.
  3. Scroll down to the General Disposition Information section.
  4. Enter the date of sale in, Date sold, disposed, or retired (MANDATORY).
  5. Enter the Basis adjustment (land, etc.) [A] (if applicable).
  6. Enter any Expenses of sale or exchange (if applicable).
  7. Scroll down to the Sale of Asset (4797/6252) section.
  8. Enter the Sales price (-1=none).
  9. Scroll down to the Sale of Home section.
  10. Select the box Sale of home (MANDATORY to compute exclusion).
  11. Select the box 2-year use test met (full exclusion)
    • If the taxpayer owned and used the home as a main home for 2 or more years during the 5-year period, ending on the date of the sale or exchange of the property. An entry in this field tells the program that the taxpayer qualifies for the full $250,000 exclusion ($500,000 is MFJ).
  12. Enter the Number of nonqualified use days after December 31, 20XX.

If the asset isn't already entered on Screen 22, Depreciation:

  1. Go to Screen 17, Dispositions.
  2. Complete the applicable information about this sale:
    1. Description of property
    2. Date acquired
    3. Date sold
    4. Cost or basis
    5. Expense of sale
  3. Scroll down to the Form 4797 section.
  4. Enter any prior depreciation in Depreciation allowed (-1=none, triggers 4797).
  5. Enter the Recapture amount (if not section 1245) (if applicable).
  6. Enter a 1 in Blank=1245, 1=1250, 2=1252, 3=1254, 4=1255 (if applicable).
  7. Scroll down to the Sale of Home section.
  8. Select the box Sale of home (MANDATORY to compute exclusion).
  9. Select the box 2-year use test met (full exclusion)
    • If the taxpayer owned and used the home as a main home for 2 or more years during the 5-year period ending on the date of the sale or exchange of the property. An entry in this field tells the program that the taxpayer qualifies for the full $250,000 exclusion ($500,000 is MFJ).
  10. Select the box Business use in year of sale (if applicable).
  11. Enter the Number of nonqualified use days after December 31, 20XX.

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