Rental property on SchE and K-1, now sold

[zackm]

What is the name of your state (only U.S. law)? Mass

1. In 2015, I purchased a property for rental, data entered on SchE.
2. In 2016, I established an LLC, of which I am the sole partner, for this property.
3. In 2016, income/expense/depr data was entered on SchE Part I.
4. In 2016, LLC was listed on SchE Part II but no income/loss data was entered there.
5. In 2017, property was sold, LLC closed. I received a 1099-S for LLC.

Two questions:

6. Did I enter the data correctly for 2016? I have a feeling I should have entered it in SchE Part II.

7.How do I enter the sale data? Do I enter income/expenses/depr in SchE Part I, then dispose the property with associated sale expenses in 4797, then transfer to SchD as long term gain?

Do I do anything with SchE Part II where the LLC is listed? How do I close that out?


I do use Turbotax, if that helps anyone lead me to the right solution. has been very useful for years but this is the first time I have this complexity.

Thank you for any help.

 

[Just Blue]

What is the name of your state (only U.S. law)? Mass

1. In 2015, I purchased a property for rental, data entered on SchE.
2. In 2016, I established an LLC, of which I am the sole partner, for this property.
3. In 2016, income/expense/depr data was entered on SchE Part I.
4. In 2016, LLC was listed on SchE Part II but no income/loss data was entered there.
5. In 2017, property was sold, LLC closed. I received a 1099-S for LLC.

Two questions:

6. Did I enter the data correctly for 2016? I have a feeling I should have entered it in SchE Part II.

7.How do I enter the sale data? Do I enter income/expenses/depr in SchE Part I, then dispose the property with associated sale expenses in 4797, then transfer to SchD as long term gain?

Do I do anything with SchE Part II where the LLC is listed? How do I close that out?


I do use Turbotax, if that helps anyone lead me to the right solution. has been very useful for years but this is the first time I have this complexity.

Thank you for any help.

You need an attorney.

 

[Zigner]

You need an attorney.

No, the OP doesn't need an attorney for this. The OP needs a tax professional. Not one that sets up shop in the local supermarket for tax season...OP needs a tax pro who is in the business year-round.

 

[zackm]

Thanks for the quick replies.

Yes, I feared I would need to contact a pro to correct and advise.

But, can some address my specific questions - even generally? Did I enter data incorrectly? How does one deal with a partnership rental?

 

[Zigner]

The problem is that you chose to ask this question on the busiest day of the year for tax professionals.

 

[zackm]

My apologies...didn't mean to imply that it is urgent. I already filed an extension for 2017, with payment due. Didn't want to submit another erroneous return and then an ammendment.

 

[Zigner]

My apologies...didn't mean to imply that it is urgent. I already filed an extension for 2017, with payment due. Didn't want to submit another erroneous return and then an ammendment.

We do have a tax pro and a tax attorney that post here regularly, but I think you might need to wait a day or two...

 

[zackm]

Of course, not a problem.

To add to my comment: I treated my one owner LLC as a sole prop, which would allow me to enter data on SchE, part I as an individual owner, as i have done in the past for another non-LLC property.

I may have entered data in the wrong place but I doubt my tax liability would change, since all data is still in the return.

At any rate, I'll wait a couple weeks or so before pinging this thread again.

 

[FlyingRon]

A single member LLC is a disregarded entity. You enter all the information on your personal tax return as if you owned the property directly.

Capital gain is reported on schedule D. Not only do you likely have a capital gain, but also depreciation recpature. TurboTax and the like do handle this, but depreciation isn't the clearest of things for someone filing by hand. I suggest you get assistance from a tax advisor.

 

[zackm]

Thanks very much for the quick reply. Yes, I expect to contact a pro soon enough.

Yes, Turbotax H&B correctly handled the recaptured depreciation and the capital gains (on 4997 and SchD).

My concern is this: the LLC has its own EIN and I did receive a 1099-S for the sale. Where do I note the LLC name and EIN on my return? Right now I have it in SchE, part II, but nothing else is entered there for the LLC. Seems incorrect.

 

[FlyingRon]

It doesn't matter. The LLC is a disregarded entity. File everything under your SSN.

 

[LdiJ]

It doesn't matter. The LLC is a disregarded entity. File everything under your SSN.

I agree and will also add that when you got the EIN for the LLC it tied into your SSN, so there will not be any confusion with the IRS.

 

[zackm]

I agree and will also add that when you got the EIN for the LLC it tied into your SSN, so there will not be any confusion with the IRS.

Thank you. That was my concern...that the IRS has the 1099-S with the LLC EIN and how I should note that on the return.

So, to be clear, I can enter data in SchE part I and NOT note the LLC info in part III or at all on the return, correct?

 

[LdiJ]

Thank you. That was my concern...that the IRS has the 1099-S with the LLC EIN and how I should note that on the return.

So, to be clear, I can enter data in SchE part I and NOT note the LLC info in part III or at all on the return, correct?

It is NOT necessary to note the LLC information at all.

 

[zackm]

Thank you again!

That should close this inquiry.