jasdlm Posted March 5, 2017 Report Share Posted March 5, 2017 Taxpayer is an LLC (2 partners - not spouses). House sold on installment was repossessed and 4 days later sold at a loss. I have calculated the basis following the repossession and then show the sale on 4797. House had been a rental prior the the installment sale 5 years ago. Seems to me that there is a short-term, ordinary income loss based on the sale of the repossessed property. Am I thinking about this correctly? Thanks much. I've tried google, also, but I must not be putting the question in correctly. I have carefully reviewed the IRS Publication about recalculating the basis on the repossession, and I feel okay about that. It is the short-term ordinary income loss that I am worrying about. Quote Link to comment Share on other sites More sharing options...
Lion EA Posted March 5, 2017 Report Share Posted March 5, 2017 This is from my sleep-deprived brain, but I think the holding period includes his prior ownership also, so long-term if the two periods add to more than a year. Try your tax research, such as IntelliConnect. 3 Quote Link to comment Share on other sites More sharing options...
jasdlm Posted March 5, 2017 Author Report Share Posted March 5, 2017 You are brilliant! That makes so much more sense, and I did just find the back up. I really appreciate it. It just wasn't passing the smell test. 3 Quote Link to comment Share on other sites More sharing options...
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