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Rental Property sold to related party

Jhoebo
Level 1

I have a client who sold their rental property at a loss to a related party.  I understand that they cannot take any losses on this sale. When I enter the info on the Disposition Worksheet Proseries wants to take the losses on 4797.  I feel that this "disposition" should be reported on their Return, but there doesn't seem to be a clean way to do this without overriding several items, which prevents e-Filing. 

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3 Comments 3
dkh
Level 15

In the Disposition section of Asset Entry Worksheet, there is an entry line Asset gain/loss basis, if different Can that be used to prevent the loss from flowing to F4797?

 

Jhoebo
Level 1

Thank you for your response.  When I adjust the Asset gain(loss) in this section it gives me an error message about the land must be included in the basis.  To zero out the loss I have to reduce the basis below the land cost.

 

 

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dkh
Level 15

Do you have an amount in  Land included in Cost ?   If yes, what have you checked in Disposition section for Report Land Separately?     Could that be causing the error?

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