My company has a machine that has been a rental unit for the past two to three years. The client is getting a new machine soon and we will receive the old one back from them at that point. We have lined up a buyer for the machine and the value of the machine will be approximately $1500 ($3385 cost less $1885 depreciation).

My question is this, how do I enter the nachine into inventory so that we can sell it? does it need to be entered into inventory or can we sell it and show the gain/loss on the sale on our 4797 when tax time rolls around again?

konor