Questions re Sale - Residential Rental Property

This form documents the understanding reached by the two parties and is useful to file if both file parties t.

See, that's why there should be a meeting of the minds before the sale is closed.

If permanently attached to the building, yes. If more like a room heater that happens to hanging on screws, and can be easily removed, no.

I've always considered appliances not permanently attached to the property to be Sec 145.

And I agree it is very convenient for costs for 1245 property to be their adjusted basis at time of sale.

Is the final word (or words) in the foregoing sentence missing? Do I infer from your comments re being "useful" that filing of Form 4797 is maybe optional or that the IRS does not chase you down if you don't file? Parenthetically, I find it rather odd that the mountain of forms and disclosures we had to execute in connection with the sale did not include the 4797, so I am wondering if a lot of people just ignore it.

Could not agree more. Too bad we did not know about Form 4797 at the time.

I assume you mean Sec 1245

Thanks for your reply.

Robert Leavitt

apartment building acquired in 1992. The sale documents did not apportion any part of the sale price to land, building, or personal property. I understand that it is not uncommon to value the personal property at book value resulting in no gain or loss on these items.

circumstances. The CPA who prepared the 2008 tax return of the other TIC seller did not mention anything about it. As a matter of fact, he just lumped the entire transaction (including land) into one column of Section III of the 4797 and made no entries on lines 25a and 25b. Is this typical?

A sale is not an acquisition (a purchase is), so why would the form be used?

market values of some of the items do not agree with the Buyers views?

That's a question for the courts. ;-)

Section 1250 property?

Think about it. Is it a permanent fixture?

be Section 1245 property?

Again, permanent fixture or removable?

If one of the parties is not a business, the form is not required.

Here's what IRS instructions say about Form 8594 [not to be confused with Form 4797]: PBouthr tpheo sseelle ro afn dF pourrcmhaser of a group obsvaapuafussa clsssiaudheeisne ttsfe ssaoea s raitts sssttnaa h dmdtlceeheh u aitafieefs t sts trghms ,muo eeoasoi tnrpksed eeuc. wFdsorci o uloulhr lndpomal rsyaa e8g t btrt5oar?ys9iacn 4dthbgh e,a te co sto oo airrs nems cipunoeoc urtrhnhntet. There, now you know everything you need to know about the 8594.

Form 8594 is required *only* where there is *or could be* "goodwill" included with assets of a trade or business that are being sold "together". In my experience, rental property is land, building and furnishings, without goodwill. Maybe, now that I think about it, would the leases-in-place be goodwill? This doesn't answer the question, but asks a new one, I guess.

Form 8594, if required, must be filed by both the seller and the purchaser, and it *doesn't* require that they agree on the values of the assets of the business being sold. Read the form and you'll see what it *really* asks for.