When my husband got a job with an 80 mile one way commute, we decided to move where his job is and rent our family home. That was in July of 2011. It has been rented pretty much the entire time and we are now getting ready to list it for sale. What tax implications are we possibly facing? =====>>>>>>>>>>>>It depends on if you dispose ot it as rental home or a primay home;aslongas you sell it a rental home, you need to report the sale of the rental property on Form 4797 then, you must recapture Sec 1250 depreciation(taken previously) taxed at 25% as ordinary income. The sale of the rental house goes in Part 3 of the 4797 as a Sec. 1250 Property. The sale of the land goes on Part 1of the 4797. It gets combined on line 13 of your Form 1040 as a capital asset.; this does count as two sales on your 4797, but one as a Sch D , form 8949 capital asset, sec 1231 asset Imean ;it necessary to separate the land and the rental house part of the sale. If it?s a loss, report the sale on Form 4797, Part I and in this case you do not need to recapture the unrecap sec 1250 depreciation.
However, if you sell it as a primary home, then, ordinarily, you are entitled to a $500Klong term capital gains exclusion on the sale of the home as a personal residence by using it for at least 3 of the 5 years prior to the sale. If you sell the house on which you have a loss or can exclude the entire capital gain, and you don't get a 1099-S form, you don't have to report it. However, when you have a gain to report, if you get a 1099-S form, you'll have to file extra paperwork for the irs with your tax return and potentially pay additional tax.
Does it help at all that we only rented the home because of moving for a job?
=======>>>>>>>>>I do not think so BUT, actually as said it depends if you dispose of it as a rental home or a primary home. so, if you sell it as a primary home, then, you are entitled to a $500Klong term capital gains exclusion on the sale of the home as a personal residence by using it for at least 3 of the 5 years prior to the sale.