For S-Corp. I sold a long term rental prop and entered info in turbotax. The cap gain shows up on lines 30 A,B form 4797 p2, but does NOT show up on K-1, what gives?

Forum|Forum|3 years ago
March 24, 2023
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This is flow through, so a capital gain must be reported on my personal taxes ... I expected to see something on 1120S Section K, line 8a but there is nothing. Please help!

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JamesG1

We are not able to see your tax return and see the nature of the gain or loss.

Are you able to find the Net gain (loss) from Form 9797, line 17 on page 1 line 4 of the 1120S?

If the entry is found on line 4, the gain or loss likely flows to the K-1 on line 1 Ordinary business income (loss).

It is possible that you are seeing depreciation recaptured on Part III line 22 of IRS form 4797 which is reported as ordinary income and not a capital gain.

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pmiceli95-gmail-Author

Thank you for your reply. I figured out the issue, and there is almost no way you could have know this without seeing the worksheet that has instalment sale info. When I went though the step-by-step instructions, I accidentally claimed this property was an instalment sale. Because there was no receipts noted in 2022, there was nothing to show on the K-1.

I deleted the asset disposition, then re-entered the numbers without the same mistake, and now the long term gain shows up on my K-1. Thank you!