IRS Form 4797 walkthrough (Sales of Business Property)

[@magdalenarivera3139]

Can you please guide me on where to get the (e) Depreciation allowed or allowable since acquisition? I'm a little confused. Is it the total amount depreciated? For example, a truck driver got on 3 years depreciation for buying a semi-truck.

[@teachmepersonalfinance2169]

Depreciation allowed is the amount of depreciation you actually claimed. Depreciation allowable is the amount you were allowed to claim, whether or not you actually claimed it on your tax return.

[@jeffreyd508]

Thx for the vid! I'm a U.S. citizen who bought a new construction condo in Kyiv Ukraine. Turns out the land owner obtained it from the city of Kyiv in 2006, and its not zoned for residential. And due to bribes, the project completed. The city of Kyiv reposessed the land now and we lost our units. I've never lived in the unit. No one has Should I report this loss on 4797? Schedule D?

[@teachmepersonalfinance2169]

I'm not really sure how to advise you here. You might be able to claim the total loss on Form 4797, but I would discuss it in person with a tax professional to determine the best course of action for your situation.

[@victoramor]

i sold a rental property sept of 2024 where i estimate i will pay like $70K. when i do my filing on April 2025, will i be charged with penalty for not paying the taxes out right when i received the proceeds of the sale on sept of 2024. if i will be penalized i want to pay now so i can avoid the penalty. i would appreciate anyone's comment.

[@teachmepersonalfinance2169]

I don't know enough about your circumstances to determine whether you would pay a penalty or not. It depends on if you've held enough tax, based on either this year's or last year's tax bill. However, you can determine this on IRS Form 2210, to see whether you are on track to be okay, or if you might need to make an estimated tax payment. You can use this form, as well as the IRS Form 1040-ES worksheet, to determine if you need to make a payment between now and the end of the year: IRS Form 2210, Underpayment of Estimated Tax by Individuals, Estates, and Trusts Article: www.teachmepersonalfinance.com/irs-form-2210-instructions/ Video: kzbin.info/www/bejne/b37QYnh_a6eGoKs Schedule AI Video: kzbin.info/www/bejne/g37FqIyjj6mAidk IRS Form 1040-ES, Estimated Tax Voucher Article: www.teachmepersonalfinance.com/irs-form-1040-es-instructions/ Video: kzbin.info/www/bejne/g6KkkGOFjZ6erqs

[@annC-mq8sz]

Could you tell me if you had a piece of farmland (with tile and fence), MACRS and it was sold from a trust how is that reported on the 4797? Some of the beneficiaries got cash and other beneficiaries purchased it but took their sales proceeds "in-kind". So it was a sale of entire property for 1.4 million. Do you just report the entire thing on part III? You need to report the entire sales price somehow for depreciation recapture and capital gains? Thank you!!

[@teachmepersonalfinance2169]

I'm not sure that I could answer this question without knowing more specifics about the situation. My educated guess is that the trust's tax return should report the sale and related capital gains (whether or not Form 4797 was used), then the beneficiaries would receive the report of their distributions when they receive their Schedule K-1s.

[@brendaosorio4820]

can you please guide me in how to report a goodwill sale

[@teachmepersonalfinance2169]

The sale of goodwill falls under Section 197 intangibles. As part of your asset or business sale, you and your buyer would need to determine how to allocate the costs associated with the purchase. You would then (each) report how you divvy up the costs into various classes (goodwill is considered Class VII) on IRS Form 8594 (see below links) IRS Form 8594, Asset Acquisition Statement Article: www.teachmepersonalfinance.com/irs-form-8594-instructions/ Video: kzbin.info/www/bejne/fWHJYaVuqb6ApM0 You would report the actual sale on either IRS Form 4797 or IRS Form 8949 (see below links), which should then flow to your Schedule D (see below) IRS Form 8949, Sales and Dispositions of Capital Assets Article: www.teachmepersonalfinance.com/irs-form-8949-instructions/ Video: kzbin.info/www/bejne/hWazkH9vr8mLg6c IRS Schedule D, Capital Gains and Losses Article: www.teachmepersonalfinance.com/irs-schedule-d-instructions/ Video: kzbin.info/www/bejne/raGziZhur5ljors Playlist: kzbin.info/aero/PLYHzJrFFCrpx8fntib5MeAQ7xMEfvPVHZ

[@frankberryjr5871]

If I traded in my vehicle for $21,000, but the bank payoff was $19,775, do I report $1,225 as my gross sales price? It would make no sense to pay taxes on money that went directly to the lender.

[@teachmepersonalfinance2169]

Instead of trying to explain this step by step, I found the following link, containing a walkthrough with someone reporting a similar trade-in. www.justanswer.com/tax/7lqui-can-should-fill-form-8824-following-information.html

[@teachmepersonalfinance2169]

Please feel free to check out our article, where we've written step by step instructions to help you walk through this tax form! www.teachmepersonalfinance.com/irs-form-4797-instructions/ If you’re looking for tutorials for other IRS Forms that you can file directly through the IRS website, check out our free fillable forms page: www.teachmepersonalfinance.com/free-fillable-tax-forms/

[@memabubbasplaytime6036]

Would you use this form when you trade a business vehicle for another?

[@teachmepersonalfinance2169]

You would. This article breaks it down a little more clearly for this type of situation: mileiq.com/blog-en-us/business-vehicle-trade-in-tax

[@memabubbasplaytime6036]

Thank you so much for the quick reply! @@teachmepersonalfinance2169

[@HUMAN-VERSION4]

Hi, is 1245 recapture? Based on accumulating tax depreciation or accumulated a book depreciation to give the adjusted basis?

[@teachmepersonalfinance2169]

Section 1245 and Section 1250 are two different tax code references for ways to depreciate business property held for over 1 year, which is considered Section 1231 property. Section 1250 applies to real property used for business, which is depreciated over much longer periods of time. Section 1245 depreciation recapture refers to personal property, such as office furniture, equipment, etc. that is depreciated over shorter periods.