cred65 Posted March 21, 2011 Report Posted March 21, 2011 TP purchased residence in 2001 for $702K. At end of 2007 purchased another residence and converted previous residence to rental (FMV $852K). The previous residence was rented all of 2008, vacant most of 2009 but an effort was made to rent. In spring 2010 the TP sold the house at a significant discount for $590K. So according to IRS pub 523 the sale is to be reported on Form 4797. So as you can see this baby going to have a significant loss. Is it correct that the basis would be lower of Cost or FMV, less Accum Depn? Is this the correct procedure to handle this? Quote
kcjenkins Posted March 21, 2011 Report Posted March 21, 2011 Basis would be the $702K less Acc Depreciation. Quote
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