Prior unallowed passive losses on rent house

Forum|Forum|3 years ago
March 4, 2023
2 replies
12 views

For last 20 years, TP has unallowed passive losses on a rent house that has now grown to $30,000 of unallowed losses.. TP sells the rent house in 2022 and the only reason he has a profit is that he has fully depreciated the property while it was owned. How can we take advantage of the prior unallowed passive losses on this rent house in the current year of sale of the house?

Lacerte Tax

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BobKamman

Level 15

That's the way it works. The accumulated losses are claimed in the year of complete disposition. As my IRS instructor would say back in Taxpayer Service training days, "Follow the form. The form is your friend."

rbynaker

Level 13

A Lacertian may need to come along and point you at the input. You're probably looking for a checkbox that says something like "complete disposition". That should free up the PALs in the year of sale.

abctax55

Level 15

Upper section of S 18 "General Info" at the very bottom:

2=delete next year.

Altho I think if you process the sale thru D 22 "General Disposition Sale date" it triggers the suspended losses too.

HumanKind... Be Both

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