larryfrederickea
Level 1
‎11-06-2020 10:44 AM

Dealing with the IRS if furnishings sold with a Vacation Rental is garage sale income.  They're saying that the furnishings cannot be added to the basis of the property,  I want to deduct the income from the sale of the furnishings from the Gross Sales Price,  and the IRS said it would be considered income from a garage sale,  and would go under other income.  Any thoughts ?  Thanks

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clr600
Level 8
‎11-06-2020 01:20 PM

How were the furnishings acquired.

qbteachmt
Level 15
‎11-06-2020 01:58 PM

"cannot be added to the basis of the property"

How was this property (the furnishings) being treated for the tax filings? It would have been separate from the Real Estate all along, of course. So, in this regard, the IRS is right.

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Just-Lisa-Now-
Level 15
Level 15
‎11-06-2020 02:23 PM
were they depreciated separately from the dwelling while it was a rental?
were they sold separately from the dwelling?

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George4Tacks
Level 15
‎11-06-2020 05:38 PM

Greetings New User - ,

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TaxGuyBill
Level 15
‎11-07-2020 09:53 PM

I'm not quite sure what your actual question is, but rental furnishings that are sold go on Form 4797.

If the  furnishings were used as a deduction (either because they are $200 or less or because they fell under the De Minimis election to deduct them), it would be Ordinary Income in Part 2.  If they were depreciated, they would be reported in Part 1 or 3, and you have depreciation recapture.