If you sold business property during the year, you must report the transaction on Form 4797, not in the personal income section.
This includes:
- Property used in a trade or business
- Property held for income-producing purposes
- Assets that were depreciated or amortized in prior years
Examples include:
- Equipment
- Machinery
- Vehicles used for business
- Buildings or land used in your trade or business
⚠️ Important:
Even if the property is fully depreciated, the sale must still be reported.
You may also need to recapture depreciation, which could result in additional taxable income.