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How do I enter in Proseries the sale of rental property when there should be no gain or loss because the sale price is between orig cost and conversion value.

Orange150
Level 1

Using the template we should not have a gain or loss:

orig cost $435K

conversion value $321K (lower of cost/FMV at rental time)

depr taken $35K

= Adj basis for gain $399K

Adj basis for loss $285K

Sale price is 370K

taxpayer did not live in house in last 5 years.

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TaxGuyBill
Level 15

You need to use a make-believe Basis.  Use a Basis of $405,000 (sale price, plus total depreciation) for purposes of the disposition.

You can enter that in the disposition area of the Asset Entry Worksheet  where it says "Asset gain (loss) basis, if different".


An alternative is to ONLY enter the sale date (no sale price) on the Asset Entry Worksheet, and enter the same numbers on the "Enterable 4797" (Basis of $405,000, sale price of $370,000, with total depreciation of $35,000).

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TaxGuyBill
Level 15

You need to use a make-believe Basis.  Use a Basis of $405,000 (sale price, plus total depreciation) for purposes of the disposition.

You can enter that in the disposition area of the Asset Entry Worksheet  where it says "Asset gain (loss) basis, if different".


An alternative is to ONLY enter the sale date (no sale price) on the Asset Entry Worksheet, and enter the same numbers on the "Enterable 4797" (Basis of $405,000, sale price of $370,000, with total depreciation of $35,000).

View solution in original post

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