Reporting asset dispositions correctly requires more than entering sales proceeds and adjusted basis. We must identify the right asset category and coordinate depreciation recapture. During this session, we’ll walk through how to report common dispositions on Form 4797, Sales of Business Property, and how to apply the §1231 rules that determine whether treatment is ordinary or capital. We’ll focus on gathering the right facts, classifying assets, coordinating depreciation recapture and carrying results to the rest of the return. We‘ll also work through practical examples to build a repeatable process for accurate reporting.
Objectives
Upon completion of this session, you will be able to:
Identify transactions that belong on Form 4797 and determine which part of the form applies
Classify business and rental assets for disposition reporting, including §1231 property and assets subject to depreciation recapture
Determine gain or loss and apply the §1231 netting process to identify ordinary or capital treatment
Apply depreciation recapture rules that commonly affect Form 4797 reporting and coordinate the results with other return schedules
