Recording the sale of a property (Rustler): ensuring I've done this correctly

Clock24 · ‎August 04, 2020

Based on Rustler's comments* on how to sell a property on Quickbooks, I have done the following. Just want to make sure I did not do this incorrectly.

(*https://quickbooks.intuit.com/learn-support/en-us/reports-and-accounting/how-do-i-record-a-sale-of-a... and https://quickbooks.intuit.com/learn-support/en-us/reports-and-accounting/recording-the-sale-of-a-pro...).

My main concerns at present:

Is it correct that the payoff of the mortgage is not accounted for in the "Gain/Loss on Property" account?
Is it correct that the original equity put into the house (~70K) is also not accounted for in the "Gain/Loss on Property" account?
My primary purpose for doing this is to submit taxes correctly. I have never "sold" a property on QB before, so out of my depth. Once this "Gain/Loss on Property" account is done, I'm not sure what comes next. That may be a question for another post.

The gap below has no meaning.

Credit (Type = Account: Subaccount)	Debit (Type = Account: Subaccount)	Description	Amount
Income = Gain/Loss on Property	Fixed Asset= Property: Accumulated Depreciation	Sum of all previous depreciation on property	$52,055.89
Income = Gain/Loss on Property	Fixed Asset= Property: Building	Original value of property when purchased	$194,900.00
Income = Gain/Loss on Property	Fixed Asset= Property: Improvements	Value of depreciable improvements made to property	$35,107.21
Income = Gain/Loss on Property	Fixed Asset= Property: Land	Original value of non-depreciable land	$50,000
Income = Gain/Loss on Property	Fixed Asset= Property: Purchase Expenses	Original costs associated with purchasing property	$915

Bank = Checking Account	Income = Gain/Loss on Property	Sales price (minus seller credits to buyer)	$280,800.00
Long Term Liability = Property mortgage	Bank = Checking Account	Balance on mortgage paid at closing	$160,533.56
Bank = Escrow	Bank = Checking Account	Cost of closing for sale (real estate commission, attorney fee, wire/courier/recording fees, conveyance tax, state tax)	$18,582.50
Income = Gain/Loss on Property	Bank = Escrow	Closing costs as above	$18,582.50

john-pero · ‎August 09, 2020

1. It IS correct that the mortgage paypoff has no bearing on gain or loss. You are reducing the liability that was incurred when purchased and think back, the loan was not income and principal over the years was not expense.

2. Yes and no. Original purchase price plus closing costs was you book asset. You may have taken depreciation, which reduced current asset value but there is recapture of the depreciation to get back to book value

3. Form 4797 sale of business property along with Schedule D capital gain/loss will be next

Clock24 · ‎August 10, 2020

Thank you, friend!

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Recording the sale of a property (Rustler): ensuring I've done this correctly

Recording the sale of a property (Rustler): ensuring I've done this correctly

Recording the sale of a property (Rustler): ensuring I've done this correctly

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