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Capital Gains

Calculation of Form 4952, line 4d: Net gain from the disposition of property held for investment

UltraTax CS classifies the following as dispositions of property held for investment:
  • Schedule D sales coded blank, N, C, or E, and entered in the
    B&D
     and
    Broker
     screens
  • Capital gain distributions entered in the
    B&D
     and
    Broker
     screens
  • Form 6252 income reported on Schedule D
  • Net short-term capital gain/loss entered in the
    K1-2
     screen
  • Net long-term capital gain/loss entered in
    K1-2
     screen
  • Net short-term items entered in the
    K1T
     screen (including carryovers)
  • Net long-term items entered in the
    K1T
     screen (including carryovers)
  • Form 8824 gains reported on Schedule D
  • Form 8814 gains reported on Schedule D
  • Form 6781 gains/losses reported on Schedule D (non self-employed amounts)
  • Short-term capital loss carryover reported on Schedule D
  • Long-term capital loss carryover reported on Schedule D
  • Partner/shareholder net capital gain/loss basis adjustment
note
You can force or enter all 0s for the amount of capital loss carryover reported on Form 4952 by using the carryover
Force
 fields in the
4952
 screen.
If there's an excess of total gains over total losses from the disposition of property held for investment, an amount shows on line 4d.
UltraTax CS calculates net capital gain as the excess, if any, of net long-term capital gain over net short-term capital loss from the disposition of property held for investment. Capital gain distributions are treated as a long-term capital gain.
Only Form 6252 installment sales forced to Schedule D entered in the
Sale
 and
InstPY
 screens are classified as a disposition of property held for investment. Form 4797 sales are treated as sales derived in the ordinary course of business and not as a disposition of investment property.
Passive activities aren't treated as property held for investment (except for rental of substantially nondepreciable property and publicly traded partnerships). If the client has a passive activity that includes a capital gain (loss) that isn't considered portfolio income, enter the information in the
B&D
 screen or
Broker
 screen and link the sale to the activity in the Form and Unit columns.

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