I sold some rental property in Jan 06. Now that it is tax time I need to some help with filing?

Question

The Federal return asks for the Asset Sales Price and expenses and also the land sales price and expenses. Should enter the actual sale amount or the amount I received after paying the mortgage I owed?

Answer 1

The amount received after paying off the mortgage is not relevant. You have to figure out how much you paid for the property and add expenses not deducted from prior income tax statements. Subtract that amount from the sales price, less expenses related to the sale. If it's a + you may owe taxes on the gain. If it's a minus number, you may be able to take a write off.
From the way your question is phrased, I think you should have a tax preparer do your income taxes for you.

Answer 2

You need professional help.

THe gain on the sale of a rental property is basically

Sale price - expenses of sale - original cost of property - costs of acquisition - capitalized improvements PLUS depreciation.

For the Depreciation amount, it's the GREATER of the depreciation you reported on previous tax returns OR the depreciation that SHOULD have been deducted on previous tax returns.

If you have no APPRECIATION for what I am talking about in DEPRECIATION, you really need a tax advisor!

BTW, the mortgage has nothing to do with this calculation, other than the expenses related to get the loan (points, etc.)

Enrolled Agent / Tax Advisor