How do I enter the sale of an asset so that it is reflected in the tax report?

ssickler

I am selling a piece of rental real estate that I have owned for about 10 years. When I do what I typically do in this case, transfer the asset value to my checking account or replacement property account, nothing shows up in the report for the sale.

Jim_Harman

What year and edition of Quicken (Deluxe, Premier, Home & Business) are you running? H&B should be able to handle this for rental properties.

ssickler

I am running H & B 2019. I don't know how to do it. Can you tell me HOW to sell a real estate asset in Q. H & B.

J_Mike

The short answer tp your query is that reporting the tax implications of real estate sales is beyomd the capabilities of Quicken and can only be handled in your tax software - e.g., Turbo Tax.

To try and illustrate - for a rental real estate sale the first question is did you do a 1031 Rollover? Whether you did or dis not rollover determines your exposer to issues such as reportable capital gains and depreciation recapture. Depreciation recapture can be a major factor on taxes owed from the transaction. These issues are all outside the scope of Quicken and can only be handled in the tax program. From my experience, Turbo Tax has a good interview process that leads you through the steps.

NotACPA

See if TOOLS, Account List, clicking EDIT adjacent to the property account, clicking TAX Schedule, and then setting "Transfers Out" does what you want.

Because the transfer of the funds from the Rental property to another asset account (i.e., the sale) would be caught by this setting.

ssickler

I have done this, but it does not recognize the Capital Gain. I agree that it should. Any other suggestions?

NotACPA

Do, Tools, Account List, Edit again.  What does it say, on the Account Details screen for "Account Type"?

And, how did you record the actual sale of the property? What "transaction"?

ssickler

When I do tools-Account List-Edit-Display Options, then under Account Intent, it says: Asset, and next line says Rental Property. I don't find an "Account Type".

I recorded the transaction probably a dozen different times. Usually I put "Sell" under Payee then square brackets around the Category to get it to transfer the value into the new property, and then a Tag with the name of the Property sold.

I have also changed the type from Rental Property to Business to see if that would help, it doesn't.

Sheldon

Tom Young

As far as I can see this just isn't handled - at least not well - by Quicken from a "tax" standpoint.  Typically gain or loss on sale of rental property is reported on Form 4797, a tax form Quicken just doesn't support.  (Well, at least my version doesn't.)  I think the nearest you can come to what you want here is to establish a Category for the gain and use that Category for the sale, linking that Category to Schedule D.

Bur Davis

I work around this shortcoming in Quicken by using categories named 'Appreciation' and 'Depreciation'. I have been using Quicken so long I can't remember whether this is a standard category, or one I made up. In any case, when I have owned and then sold a home in the past, I

a) open a Property account, whose balance is always the cost basis of the home (initially that's the purchase price, but if I have made improvements I transfer the cost of the improvement to the House account, which increases the balance of the House account, and that becomes the new cost basis). Then

b) when I sell the House, I add a line item whose amount is the difference between cost basis and sales price, and whose category is 'Appreciation'. That increases the account balance to the sales price. Then

c) I record a line item for the payment by the Buyer (which is actually a transfer from a separate account I've set up for Escrow). Then

c) I enter a transfer from the House account to my Bank Account (or wherever the sales proceeds are landing).

Unfortunately, as far as I can tell, it looks like Quicken does not allow me to tag the 'Appreciation' category appropriately for tax purposes, since there are no Form 8949 items in the 'Tax Line Item for this Category' drop down in the Edit Category dialog.

As I say, it's a workaround (or crude hack, to be more precise). All of which is to say that, in my experience, Quicken does not support capital gains from the sale of property.