Asset Entry worksheet Error 1250 applicable % should only be completed if property type is real property

You should be able to right click and enter a zero, then move forward.  It could cause you to file by mail.  My advice would be to go through the assets that were sold one by one to see if you see an entry that doesn't make sense, For this you should go through the 'Step-by-Step' and not Forms entry.

If this is associated with rental real estate, go through each asset, including the building (and land which is the same asset) to be sure you have included the selling price/selling expenses for each asset.

Below is an example of how to arrive at the selling price for each whether or not it's rental property.

Use the original cost of each asset listed on depreciation, add those together then divide each one by the combined total to find the percentage of the cost for each asset.  Use that percentage times the sales price and sales expenses to find the selling price/sales expenses for each asset. (Choices would also be fair market value on the date of the sale or adjusted basis on the date of the sale, which is cost less depreciation.)

Example:  Original Cost (of each asset on your depreciation schedule)

$10,000 Land                = 13.33% 

$50,000 House              = 66.67%

$15,000 Improvements  = 20%

$75,000 Total                 = 100%

Multiply each percentage times the sales price/sales expenses to arrive at each individual sales price/sales expense.

Did you type 0 for the percentage?  Have you tried deleting that number (so it is BLANK, not zero)?

On the sale of a residential rental property, you go to the ‘Sales Information’ screen for each asset, and there is a field called ‘Property Type’, on which you can select from the following:

• Sec 1245 – Trade or business property
• Sec 1245 – Cattle or Horses
• Sec 1245 – Other livestock
• Sec 1250 – Real property

Question: Should ‘Sec 1250 – Real property’ be selected for all the assets including new fixtures and appliances such as new HVAC, new carpet, etc. ?

It depends.  If you complete the sale through the step-by-step, TurboTax will apply the correct IRS property. See the steps below and an example to arrive at the sales price for each asset.

1250 Property: 

• The residential rental property itself, which is real property, and any capital improvements that are structural components of the building and depreciated over 27.5 years.

1245 Property:

• Appliances
• HVAC (if depreciated less than 27.5 years)
• Carpet (if depreciated less than 27.5 years)

 You need to dispose of the property by telling TurboTax how and when it was disposed of.  Follow the instructions below.

1. Click on Wages & Expenses
2. Scroll to Rental properties and royalties, click Edit/Add or Start/Revisit
3. Do you want to review your rental?, click Yes
4. Under Rent and Royalty Summary, click Edit
5. Click Update to the right of Assets/Depreciation.
6. Do you want to go directly to your asset summary?, click Yes and Continue
7. Click Edit to the right of each asset to be disposed of/sold
8. Go through several screens until you get to Tell Us More About This Rental Asset
9. Click on This item was sold…….   And continue to answer the questions

You might also review information here.

@PN10