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Screen Sale - Forms 4797 and 6252 (1040)
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Overview
Use this screen to enter asset sale information for Form 4797 (Regular and AMT) and current-year installment sales for Form 6252 (Regular and AMT). Use Screen OtheAsset to enter additional information needed to calculate Form 4797 and Screen InstPY to enter prior year installment sale information. Use Screen K1Sale to enter sales of section 179 property separately stated on Schedule K1.
note
UltraTax CS provides a client-specific option to specify the method of entering asset information. You can enter it in either the asset module or in the various depreciation screens.
If you choose the asset module as the method of data entry, this screen is not applicable and does not appear.
To enter asset information using this screen, choose File > Client Properties, select the Advanced Properties button, and clear the
Enter asset detail information
checkbox in the Enter Asset Detail tab to turn off the detailed asset information default.For more information about asset data entry, refer to Where do I enter asset data?
UltraTax CS uses the dates of acquisition and sale entered in this screen to determine short-term versus long-term transactions and the appropriate part of Form 4797, Form 6252, or Schedule D in which to report sales.
Screen Sale is designed to enable you to enter asset sale information in one place and have UltraTax CS determine the proper category (or categories) in which to report each sale on the return. Because the information entered in Screen Sale may be reported on either Form 4797 or Form 6252 there is not a one-to-one relationship between the sale screen and either form. Therefore, clicking to Forms view from Screen Sale may not always return you to the correct form.
Asset module transfer
Data entered in the asset module automatically transfers to the appropriate field(s) on this screen. UltraTax CS displays the transferred data in blue text.
You can overrule the transferred amount by entering the appropriate amount in any transferred field.
note
- UltraTax CS does not overwrite overruled fields with any subsequent asset module transfers.
- Overruled field values will be used in the calculation of the return.
- To restore the transferred amount, right-click and select Delete overrule.
- To acknowledge an overruled field, right-click and select Acknowledge overruled data.
For more information on Overrules, please refer to the Statements overview and Enabling notifications of overruled data.
Overrides
To force printing Forms 4797 and 6252 (for current-year sales), enter the asset information in Screen Sale. Then override the asset information on the form if needed.
If you enter asset information directly in Form 4797 or Form 6252 and not in Screen Sale, UltraTax CS does not print the form.
Asset information that you enter directly in the form does not transfer back to Screen Sale. Do not enter asset information directly in the form. Enter sale information in this screen instead.
Source data entry
The Source Data Entry utility enables you to enter data on facsimile versions of forms your clients submit for the preparation of their tax returns. Once the facsimile forms are completed, you can export the data to UltraTax CS and transfer it into your client data files via the data sharing feature. For more information including a list of available facsimiles, refer to the Source Data Entry overview.
Forms 4797 and 6252 - General Information
The information in this section applies to all of the forms used to report the sale of assets.
Unit / Form
These fields contain information about the business unit activity. UltraTax CS uses this information to gather and coordinate information for the business unit activity. For example, these fields enable UltraTax CS to link information (such as income, loss, sales, credits, and asset detail) for the activity. The following table lists the available forms and the folders in which they are located.
Folder | Form description |
|---|---|
Business | Schedule C |
Rent & Royalty | Schedule E, Page 1 |
Farm | Schedule F |
Farm Rental | Form 4835 |
K1 1065, 1120S | Schedule K1 S-corp / Partnership |
K1 1041 | Schedule K1 Trust / Estate |
1040 Adjustments | 2106, 8829 |
Because there are multiple forms available in the 1040 Adjustments folder, you will need to enter the form information. The available forms are listed in the table that follows and in the fieldview.
Form code | Form description |
|---|---|
2106 | Form 2106 |
Misc | Miscellaneous |
M | Miscellaneous |
Use Screen Sale, located in the Personal Sale folder, to enter information about a sale that is not connected with a business unit activity.
note
- You can leave theFormandUnitfields blank in screens located in the Personal Sale folder. The only form code available to these screens is M.
- Screens 4562, 8829, and Auto are only available when detailed asset data entry is turned off(To turn off detailed asset data entry, selectFile,Client Properties, selectAdvanced Properties, and clear theEnter asset detail informationcheckbox in the Enter Asset Detail tab .) Although Screens Sale and 8824 in the Personal Sale folder are visible when detailed asset data entry is turned on, sales entered in Screen Sale and like-kind exchanges entered in Screen 8824 cannot be linked to a business unit activity. Enter sales and like-kind exchanges related to a business unit activity in that particular entity's folder.
Description
This description, which transfers automatically from the asset module , is used as the unit description. This field is mandatory.
State
If you are processing a state return, enter the two-character postal code for the state to which this unit belongs. This code is used by the various state applications to help determine in-state and out-of-state amounts.
note
- A postal code entry is required for proper state processing.
- To transfer data to a state input screen, enter codeMin theFormfield in the Personal Sale folder. You can leave theUnitfield blank in screens located in the Personal Sale folder.
- For New Hampshire returns, UltraTax CS uses the two-digit state postal code for the location of each business activity to process apportionment Forms BET-80 and DP-80.
Refer to State fields for more information.
Treatment
The information in this field controls where the information appears on Form 4797 or Schedule D. Note that the asset module automatically enters code
1
, 2
, 3
, or 4
based on the nature of the asset. You can override the code that UltraTax CS enters, if desired.note
Installment sales subject to section 1202 exclusion (i.e. coded V, X, Y, or Z) will calculate and report 100 percent of the installment income on Form 6252 Schedule D line 11 and the exclusion amount on Form 8949 page 2 with code "S."
Section 1250 property
Enter
X
to indicate that the asset sold qualifies as section 1250 property. UltraTax CS calculates unrecaptured section 1250 gain, if applicable, and uses the amount in the tax calculation using maximum capital gains rates.Unrecaptured section 1250 gains from Forms 4797 and 6252 transfer to the Unrecaptured Section 1250 Gain Worksheet. This worksheet calculates the total unrecaptured section 1250 gains to be reported on Page 2 of Schedule D.
Sale of auto asset
For employee business expense activities using supplemental business expense (SBE) allocation, mark this field if the sale is related to an auto asset. UltraTax CS uses this information to include the sale of the auto asset for passive and at-risk calculations when supplemental business expense allocation is present in Screen 2106. For all other activities, this field is optional.
Gross proceeds...
Enter
X
in this field to indicate that this sale was reported on Form 1099-S or 1099-B. UltraTax CS enters the total of the gross sales from all sales marked on line 1 of Form 4797.Buyer's part of real estate tax code/amount
This field is used to report the amount of real estate reported on Form 1099-S Box 5. This box reports real estate taxes charged to the buyer at the settlement. Report this amount on the return by entering the appropriate code in the code field.
Code | Condition | Result |
|---|---|---|
1 | Real estate taxes already paid; reduce real estate taxes deducted | Will reduce Schedule A line 6, but not below zero |
2 | Real estate taxes already deducted; report as other income | Will be reported as other income on Schedule 1 (Form 1040), line 21 |
note
If there is no code entered in the code field, the amount field will not be reported anywhere on the return.
1099-S property in asset detail, do not report Source Data Entry data
When an X is entered in this field, all information on the screen is ignored and not reported on the return. This field should be used when information was shared from the Source Data Entry utility for an asset in the asset module (for example, 1099-S entered in the Source Data Entry utility for rental home entered in asset detail). The asset disposal should be entered in the asset tab.
Disposition due to casualty / theft
Enter
X
in this field if you want UltraTax CS to transfer the gain to Form 4684, Section B, line 33. Only mark this field when code 3
is entered in the Treatment
field. Please refer to the instructions for the Treatment
field in this screen.Postponed gain due to casualty / theft
Enter the amount of postponed gain due to casualty or theft. UltraTax CS reduces the amount of any calculated gain by the amount entered in this field.
Property type code
Select the code that best describes the property listed in the
Description
field. If you do not enter a code, Form 6252, line 1, will default to code 4 – Other property types.Sale to related party
If this field is marked and the sale is a loss, UltraTax CS enters an item to reverse the loss on Form 4797, line 2 or line 10 (depending on the holding period).
State use
If applicable, enter a state use code or select a code from the fieldview. The codes that are available in this field are specific to the state postal code entered in the
State
field. If state use codes are not applicable to the entered state, this field will be disabled (shaded).- For California returns, code4is not applicable for this screen.
- For Idaho returns, enter5in this field if the unit qualifies for capital gains deduction. This amount will automatically transfer to 1040-ID Form CG - Idaho Capital Gains Deduction.
- For Iowa returns, enter3in this field if the unit is eligible for Qualifying Capital Gains Exclusion. This amount will transfer automatically to 1040-IA Screen IASale.
- For Massachusetts, Pennsylvania, New Hampshire, and Wisconsin returns, enter1in this field for a unit that does not qualify for installment treatment.
- For New Hampshire returns, enter2in this field if the unit qualifies for Proprietorship Business Profits Tax.
- For Oklahoma returns, enter8in this field if the unit qualifies for capital gains deduction. This amount will automatically transfer to 1040-OK - Oklahoma Capital Gain Deduction Worksheet.
- For Vermont returns, enter6in this field if the unit qualifies for the 40-percent capital gains exclusion.
Sale Information
Date acquired / Date sold
Enter acquired and sold dates in MM/DD/YY format. Enter
V
to print the word Various
for the date on the return; enter I
to print Inherit
.Commissions and other expenses for sale
Include fixing-up expenses in this field for Form 6252. UltraTax CS adds amounts entered in this field to the basis for 4797 dispositions. This amount is reported separately for installment sales.
Depreciation allowed or allowable
The depreciation amount in this field should include the amount of any section 179 deduction. Any amount transferred from the asset module automatically includes section 179.
Alternative minimum tax gain / loss adjustment
Enter the difference between the gain or loss reported for the regular tax and the gain or loss calculated for the AMT. UltraTax CS uses this amount to calculate the disposition of property reported on AMT versions of Forms 4797 and 6252.
Form 4797, Part III - Recapture
This section pertains to Form 4797, Part III. The numbers, such as 26(a), refer to the line numbers on Form 4797, Page 2. Do not use this section to enter assets that were sold at a loss.
If data is not entered in this section and the
Section 1250 property
field in this screen is blank, UltraTax CS defaults to treating a calculated gain as from the disposition of section 1245 property.Applicable percentage
When recapturing depreciation already taken, the applicable percentage is 100 percent unless you enter a value in these fields.
Form 6252 - Current Year Installment Sale
Use this section to enter information for current-year Form 6252 transactions for Parts I and II. Enter prior year installment sales in Screen InstPY.
Current-Year Installment Sale
When using this section in the year of sale, enter applicable information in the following fields:
Mortgage and other debts the buyer assumed
and Total current year payments received
. The Mortgage and other debts the buyer assumed
field must include the amount of any indebtedness assumed. UltraTax CS prints Form 6252 if an amount is entered in this field, if it is the year of the sale, or if it is a related-party transaction and Part III is required. Enter 0
(zero) in this field to print Form 6252 when there are not payments in the current year.Form 6252 - Related Party Installment Sale Information
Use this section to enter related-party installment sale information.
Date of second sale
UltraTax CS uses the date of the second sale to complete Form 6252, Part III, Related Party Installment Income. If the second disposition occurred less than two years before the first disposition, additional income may be recognized on Form 6252.
Explanation if no tax avoidance purpose
If the non-tax avoidance exception applies to the disposition, enter the explanation as required by Form 6252 in the attached statement dialog. If there is data in the statement dialog, UltraTax CS marks the appropriate checkbox on the form and prints the statement with the return.
note
If you enter information in the attached statement dialog and enter code
1
or 2
in the previous field, UltraTax CS marks two exception codes on Form 6252.Selling price of property sold by related party
Enter an amount in this field if the related party resells the property within two years of the original sale.