Installment Sale of Rental Property?

[Koss]

This should be straightforward, but I haven't done one of these recently, and I could use some help.

Assume the following facts, for a residential rental property:

Purchased in July, 1995
Cost basis of the building: 42,288.00
Cost basis of the land: 7463.00
Accumulated depreciation: 15,300.00 (on 40-year ADS)
No other adjustments to basis

Sold on 04/09/10
Contract sale price: 51,250.00
Principal payments received during 2010: 480

What sort of outcome should I expect on this?

What should I be seeing on Form 4797 and Form 6252?

I've come to the conclusion that I can't rely on my software for this one. Either the program I'm using requires manual entry of some of the data on forms, or I'm just not putting in the information in the right order, or...

or there's something else that I'm just not getting about this thing.

BMK

[veritas]

One factor missing here

This should be straightforward, but I haven't done one of these recently, and I could use some help.

Assume the following facts, for a residential rental property:

Purchased in July, 1995
Cost basis of the building: 42,288.00
Cost basis of the land: 7463.00
Accumulated depreciation: 15,300.00 (on 40-year ADS)
No other adjustments to basis

Sold on 04/09/10
Contract sale price: 51,250.00
Principal payments received during 2010: 480

What sort of outcome should I expect on this?

What should I be seeing on Form 4797 and Form 6252?

I've come to the conclusion that I can't rely on my software for this one. Either the program I'm using requires manual entry of some of the data on forms, or I'm just not putting in the information in the right order, or...

or there's something else that I'm just not getting about this thing.

BMK

The sales price must be allocated between the land and the building to start with.

On the 4797 you will be reporting the sale of the building on page two of the form and the land will be reported on page 1 Part 1.

[snowshine]

Assuming relative values of the land and structure have remained constant (a big IF), then I get a profit % of 32.78% with 84.98% of the gain attributable to the building. I hadn't done one of these in awhile either, thanks for the refresher!

[Koss]

Installment Sale

The sales price must be allocated between the land and the building to start with.

On the 4797 you will be reporting the sale of the building on page two of the form and the land will be reported on page 1 Part 1.

Are both transactions reported on Form 6252?

BMK

[veritas]

yes

Are both transactions reported on Form 6252?

BMK

First to the 4797 then to Two seperate 6252 forms, one for the land and one for the building.

[veritas]

fyi

There is an example in TTB.