All Things Tax

All Things Tax

Like the title says, from the filing process and tax questions to tax policy and reform, you can search and share All Things Tax here. This is the place to find answers to all your general questions that don't fall under the other categories. And just a reminder: questions about software or online filing should be posted in DIY Products.

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Esteemed Pioneer
Posts: 11
Registered: ‎12-16-2015
Accepted Solution

Problem with Rental Loss Calculation

I am working on my North Carolina taxes. I have a rental property there and I live in another state. On the Federal Form for Rentals and Royalties there is a question regarding "AVERAGE LEASE LENGTH". It asks you whether the average lease was seven days or less. The answer to the questions has an impact on how much of a loss will actually carry though to the State form.

 

If you look at the "whole form", however, the tool is not registering any answer. It is locked and defaults to a Y (Yes) answer no matter if you choose Y or N. Of course, the answer to the question for me and most people is "no". I leased the home for a year, so the lease is not 7 days or less. But the tool is defaulting to "Y" and the formula is not calculating correctly or carrying through the correct loss number.

 

I have tried deleting the form twice, reentering everything and it still defaults to the same entry.The box on the whole form is locked so you cannot change it.

 

How do you correct this? I cannot complete the rental portion of my taxes because it's calculating wrong.

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Associate (Pioneer)
Posts: 253
Registered: ‎01-08-2018

Re: Problem with Rental Loss Calculation

Hello Holly2,
 
Welcome to the H&R Block Community.
 
According to the information you provided, it sounds like you are using the H&R Blockdesktop/downloaded software. Upon reviewing the instructions in the software, the Average Lease Length (7 days or less) interview question pertains to a section of the Rentals and Royalties "whole form" that says:
 
"Check here if your average lease was seven days or less:
If your average lease was seven days or less, check here if you materially participated in this rental activity."
 
This specific location of the Rentals and Royalties "whole form" about "Average Lease Length (seven days or less)" does not list the "(Y) Yes" or "(N) No" information. Instead, it will show a checkbox where if you select “Yes” about the “Average Lease Length” was seven days or less, a checkbox will be checked off for this specific area.
 
The only area of this Rentals and Royalties "whole form" that shows the "(Y) Yes" or "(N) No" information is at the very bottom located below "VII. Passive Activity Computation" heading. Beneath this heading, the "Yes" and "No" information pertains to "Is this a passive activity" and "Rental real estate w/active participation?"
 
The "Is this a passive activity" ties to the following interview screens: "Real Estate Professional" and "Material Participation". If you click "Yes" on the "Real Estate Professional" interview screen, this will prompt the next interview screen for "Material Participation."  Then, if you click "Yes" on the "Material Participation" screen, it would show a "N" (no) answer for "Is this a passive activity?" on the Rentals and Royalties "whole form."
 
The "Rental real estate w/active participation?" ties to an interview screen called "Active Participation in Rental" that has its own Yes and No answers. So, clicking the Yes or No options on that interview screen should adjust the “Y” (yes) and “N” (no) information in the area for "Rental real estate w/active participation?" on the Rentals and Royalties "whole form"
 
So, for this situation about the rental loss information being carried over from Federal to the North Carolina state return, head over to the interview screens mentioned above, read the screen instructions carefully, click either the Yes or No option accordingly, click the Next button several times, and see if that gets you to the proper amount shown on the NC return.
 
If you continue to have issues with this, you can contact Product Support in one of the following ways:
- For telephone support, call 1 (855) 897-8639
- For support via our online chat system, follow the steps in this link:
 
As an alternative, you can try to use the H&R Block online product and see if that works for you. The H&R Block online tax product features the Tax Pro Review service. Tax Pro Review is where you have an online tax professional to review and make adjustments to your return. For more information about Tax Pro Review, go to the following link:https://www.hrblock.com/online-tax-filing/tax-pro-review/
 
If you prefer to go to a local H&R Block tax office to handle the return, see the following link to use the H&R Block Tax Office Locator:https://www.hrblock.com/tax-offices/local-offices/
 
If you have any other questions, I'll be glad to help.
 
Lawrence,
Tax Research Specialist