Fill Form 8815 Acquired 2023-2024

Music. How to report the sale of a US rental property. Hi, my name is Alan Madden from Madden Chartered Accountant. In today's video, I will show you how to report the sale of a US rental property on a US tax return. Before watching this video, I recommend that you watch my two-part series on how to prepare a 1040 non-resident tax return for US rental properties. Let's look at the example of Justin Trupo, a Canadian resident who owns a US rental property. He purchased the property in 2014 for $100,000. He sold the property on December 31st, 2016 for $130,000. Justin paid a commission of $2,002 as a real estate agent for selling the property. At the end of 2016, Justin has claimed a total depreciation of $10,606 since he purchased the property. Justin has to complete form 4797 - Sale of Business Property. On page one of this form, he should write his name at the top and his US tax identification number. On page two, Justin should write a description of the property (example: building), the date the property was purchased, and the date the property was sold. Next, Justin has to calculate the adjusted basis or tax cost of his rental property as follows: purchase price ($100,000) plus commissions ($2,000) minus depreciation to date ($10,606). The adjusted basis is equal to $91,394. The difference between the selling price of $130,000 and the adjusted basis of $91,394 gives rise to a capital gain of $38,606. The next step is to complete Schedule D, but first, you need to understand the difference between long-term and short-term capital gains. Capital gains can either be treated as long-term or short-term. Long-term gains arise from a property that is owned for at least one year prior to sale. Short-term gains arise from a...