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December 12, 2019
Question

Can turbo tax help me with tax related issues ( tax break) involving the sale of my former home at a loss while also having it as a short term rental?

  • December 12, 2019
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1 reply

DanielV01
Employee
December 12, 2019

It depends.  The sale of your primary home at a loss is not deductible and does not result in a tax break.  Potentially, the sale of a rental home for a loss could be deductible, but it is more likely than not that you will realize a gain, even if it doesn't feel like a gain.  The reason is that part of your adjusted basis in the residence is depreciation taken or allowable.  You should have been depreciating the home as part of the expenses claimed on the rental.  But even if you chose not to deduct depreciation, upon selling the home you must subtract the depreciation you should have taken from the purchase price.  

 

TurboTax can help you to get the correct calculations and tax implications for the sale of this home, yes.  But it is more likely than not that you will not be able deduct a loss, and a possibility that you will have at least some taxable gain arising from the sale.

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