Selling investment property at a gain

I reached out to one of our AnswerXchange SuperUsers, TaxGuyBill, and this is what he said: 

"In most cases, you can report the sale in the rental section.  When you do that, you say it was sold in the introductory part of the rental section, than you go into each "asset" to sell it.  When you do that, the program does everything automatically (regular rental income, capital gains, depreciation, and everything else).  The rental income is one thing, the capital gains and tax on the depreciation is a second thing, and if there are any Passive Loss Carryovers, that is a third thing.  But it everything is done when you report it in the rental section.

If you say "yes" to the "Special Handling" screen, the sale is usually entered in the "Sale of Business Property" section.  With that, you need to manually look up the depreciation (prior depreciation plus the current depreciation) to report the sale, but then the program will sometimes do the rest of the work.

Besides the list of items on the "Special Handling" screen", there could be a few other situations that was warrant saying "yes" to that screen (which would require the sale to be reported under "Sale of Business Property").  For example, a house with multiple improvements may be easier to report as one sale, rather than allocating the sale price between the multiple assets (but you still need to go through each "asset" to enter the sale DATE in order to stop the depreciation).

However, there are situations that TurboTax can not report, primarily if it was originally personal-use property and it was converted to rental/business use when the Fair Market Value was less than the Basis.  Although the program has slightly improved, the program does NOT tell you what to do with that situation.  There have been several users that the program has told them the wrong tax result by tens of thousands of dollars."