Marie Posted March 31, 2012 Report Share Posted March 31, 2012 Client sold rental house at a large loss. When selling the asset in the asset entry part, it went to the Part 1 of 4797, but I have a PAL adjustment (a positive number) of more that half the loss. The oridinary loss it figure went down to ordinary loss, but another worksheet show a carryover. I'm not familiar with this. How is it working? Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted March 31, 2012 Report Share Posted March 31, 2012 Have you gone into the Sch E and clicked on the box for "Complete Disposition of a Passive Activity"? I think that is your problem. It is a two step process to dispose of a rental activity in ATX. You have to do the sale in the Asset Entry form and then click the box on the Sch. E. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
Marie Posted April 1, 2012 Author Report Share Posted April 1, 2012 OK, I clicked the box that says complete disposition of a passive activity. Now I have the large loss that i thought I should, but it carries down to Part II as ordinary loss, why isn't it a capital loss subject to $3000 per year. The way it looks I will have a NOL carryforward. Does this sound right? Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted April 2, 2012 Report Share Posted April 2, 2012 Sounds absolutely how I would expect it to come out. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
ILLMAS Posted March 21, 2018 Report Share Posted March 21, 2018 Sorry for bringing this post from the dead, but what happens if one forgets to check off "Complete disposition....." and the sale happened in 2016? Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted March 21, 2018 Report Share Posted March 21, 2018 ILLMAS - this relates to your other post from a couple days ago? I was wondering if you did not check the box on the E when you posted that. My suggestion is to amend the 2016 return. If it creates an NOL in 2016, you are going to have to carry it back to 2014 and 2015, since you missed the timeline to elect to carry forward. Tom Modesto, CA Quote Link to comment Share on other sites More sharing options...
ILLMAS Posted March 21, 2018 Report Share Posted March 21, 2018 25 minutes ago, BulldogTom said: ILLMAS - this relates to your other post from a couple days ago? I was wondering if you did not check the box on the E when you posted that. My suggestion is to amend the 2016 return. If it creates an NOL in 2016, you are going to have to carry it back to 2014 and 2015, since you missed the timeline to elect to carry forward. Tom Modesto, CA Yes, I went back to the 2016 return, checked off the complete disposition and there is no limitation, 100% of the loss is following to the 1040, so amending the 2016 should be sufficient? Thanks MAS 2 Quote Link to comment Share on other sites More sharing options...
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