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Ordinary Gains

Report Ordinary Gains on Form 4797

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Ordinary Gains: Form 1040 Line 14

Report any profit (or loss) from the sale of assets used in your trade or business using Form 4797. (Form 4797 in PDF format, and Instructions for Form 4797.)

If the same asset was used for both business and personal purposes, you must allocate any gain between Form 4797 and Schedule D. An example is a house that is used partly as a residence and partly as your office. Gains on the sale of business assets are ordinary gains and taxed at ordinary income tax rates. These gains do not qualify for capital gains treatment. Losses on the sale of business assets are ordinary losses, and are not subject to the $3,000 limit on losses like capital losses.

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