Rental property convert to primary residence

Forum|Forum|3 years ago
April 14, 2023
2 replies
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I have a rental property many years with passive loss (form 8525), 2022 decided to move back as primary residence, and no rental income for entire 2022, when I enter information about "was this property rented for all of 2022", I checked "I did not rent, nor attempt to rent, this property at all in 2022", then TT suggested to delete it as a rental, however once click continue, the entire schedule E , Depreciation form including form 8525 has been removed, I'm not sure how do I continue file Form 8525 for passive loss, did I do something wrong?

Thanks for advice.

MAK70

You do not have to file the passive loss with your 2022 tax return if you did not rent the property, but you will need to keep a copy for when you sell the property.

Mike9241

you need to keep track of the disallowed passive losses and cost and depreciation taken - probably from pages in the 2021 return. when you sell the unallowed passive losses will need to be entered to get the deduction and you'll have to recapture depreciation before any allowable home sale exclusion is applied