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Rental home sold but back rent collected in different year - how to report back rent collected from judgement

Forum|Forum|7 years ago
March 12, 2019
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I have a rental home that for years was reported on a schedule E. I sold this home on land contract and it is being reported as an installment sale. Recently, I began receiving judgement payments from a tenant that owed back rent prior to selling the home, 3 years ago. I am looking for help determining where to report the judgement payments which are satisfying the back rent. If I report them on Sch C it will be subject to SE tax. I am no longer reporting the property on Sch E so my assumption is it doesn't belong there as a stand alone or added to another active property.

Best answer by IsabellaG

You could still report it on Schedule E. You could list the address of the property, and name the property "Back Rent" and claim no expenses against the income. Or you could report it as Other Income:

First, go to Federal Taxes and select Wages and Income.
Scroll down to Less Common Income
Choose the last item, Miscellaneous Income
On Let's Work on Any Miscellaneous Income choose the last selection, Other reportable income.
Enter the amount and description of the income.

IsabellaGAnswer

You could still report it on Schedule E. You could list the address of the property, and name the property "Back Rent" and claim no expenses against the income. Or you could report it as Other Income:

First, go to Federal Taxes and select Wages and Income.
Scroll down to Less Common Income
Choose the last item, Miscellaneous Income
On Let's Work on Any Miscellaneous Income choose the last selection, Other reportable income.
Enter the amount and description of the income.