Converted residence sold

[TAX4US]

Anybody have a worksheet for selling a residence that was converted to a rental and sold after the 5yrs have passed?

[Lion]

Form 4797...

[TaxGuyBill]

When it was converted to a rental, was the Fair Market Value MORE than the Basis at that time? If so, it is just a sale of a rental (Form 4797). Nothing special, and you don't need to take into account that it previously a personal residence.

If the Fair Market Value was LESS than the Basis when it was converted to a rental, that could make it more complicated. If that is the case, we'll need the details in order to correctly guide you.

[TAX4US]

Now have some #'s. Cost 83k FMV at conv 94k dep taken 21k sold for 51k. I figure a tax loss. Been rented since 2009 and in a distressed region.

[TaxGuyBill]

With those numbers, looks like an $11,000 loss. But don't forget to factor in any improvements that may have been made.

[terryats]

Looks like you have a section 1231 loss, so you will be able to deduct the loss from other income. Just fill out the 4797 as Lion replied.

[ATSMAN]

Now have some #'s. Cost 83k FMV at conv 94k dep taken 21k sold for 51k. I figure a tax loss. Been rented since 2009 and in a distressed region.

Was the sale an arms length transaction? I have had many such clients over the years and when I see sales price significantly below market value I inquire and 9 out of 10 times they are selling to a family member.