On the form 1041, do you represent the sale of a home on Form 4797 or on the Home Sale worksheet? The home has sat vacant and has not been used for business.  I have seen threads discussing both ways and I have not found clear guidance reading through the IRS form instructions.  By definition, once a house is inside a trust how is the asset characterized as a personal home or a business?  There has been no depreciation so if I use the 4797 I was concerned it may trigger an audit flag because of no depreciation.  However, when using the Home Sale Worksheet if must answer the question whether the home was used strictly for personal residence and if you say no, it automatically says yes to the next question that it was used for investment.  The house sat vacant, so not used for investment nor personal residence.  The net tax effect is not different but just wondering which is the right way.  Thank you in advance for any coaching on how to view the house in the non-grantor trust.