Capital improvements made right before selling a rental property

Similarly to the screenshot shared, you enter the improvements as a New Asset in the month the work was done.  TurboTax will compute the depreciation of the improvements for those short months so you will get depreciation expense.

When you sell the property, the basis of the new improvements ( carpet, fixtures, etc) will be included in the Cost Basis for the sale.

Follow the steps below to enter the sale.

1. With your return open in TurboTax, search for rentals and then select the Jump to link in the search result.
2. Answer Yes to the question Did you have any income from rentals or royalties?
3. When you get to What are you here to report? select Rental property and fill out the description, address, and owner.
4. When you hit Tell us about your situation this year check the Sold or disposed of property box along with any other boxes that may apply.
5. Continue following the onscreen prompts to enter info about your rental property.
6. Eventually, you'll get to the Review your rental property info screen. On the following screens, we'll ask you to enter all the info we need about your rental property.
7. You can report the sale in the Expenses/Assets (Depreciation) section, along with any other pertinent info (like income and expenses)

Tip: Take your time and pay close attention. There's a lot of info and it's easy to miss if you're in a hurry.

Sale of Rental Property

@ABS