Rental Converted to Personal PAL Deduction

[geekgirldany]

I sent the return yesterday to Drake and got the same answer. If there are PAL on the Sche E screen then it will carry. So delete the PAL and keep track somewhere else. I asked the same question to NATP specifically about Form 8582 being needed. In short they said it is not and continue back to using it when the rental starts up. So I guess that is what I will do.

Thanks everyone for your help.

[TaxGuyBill]

I asked the same question to NATP specifically about Form 8582 being needed.

Did they say why? The Instructions for 8582 indicate it IS required, so they would need to provide some justification for their answer.

[geekgirldany]

Well I think I might have misunderstood. I had to put this on the back burner to do some other returns. Reading NATP response again this is what the research said:
"Continue to complete Form 8582 for the PAL carryforward for when it is a rental property again."
I suppose keep preparing it until it is a rental property.

Drake will not allow me to do this.... basically remove the PAL and keep track in notes. It seems several on the Drake Forum just do not use the Form 8582 for the year rental stops and keeps it in their notes until rental restarts or it is sold. So the only way is to force Drake to $150,000 AGI where the $25,000 is not calculated. The only problem with that is I worry the IRS will process the form see the AGI is not correct, correct it, and give them the $25,000 deduction.

I thought about manually filling out a Form 8582 and attaching it to the efile return, would that work?

[JohnH]

Or you could force the 8582 and paper file. Your reason on the 8948 would explain that you need to attach the 8592 but your software won't allow it.

[TaxGuyBill]

If it makes you feel better, ProSeries (and by extension, TurboTax) does not file 8582 either if there isn't a rental.

As far as I know, these are your options:
(1) Attach it as a PDF.
(2) File by mail with the 8582.
(3) Say it was rented (but remove the assets for depreciation), so it keeps 8582.
(4) Do nothing, and file it without 8582.

As for the best one, I don't know.

[geekgirldany]

Hmm yep a few options to pick and I don't know which is the best. Thanks for letting me know that ProSeries does the same.
Seems that other Drake Users have not been filing the 8582 so I guess I will just follow suit.