A vacation home is a capital asset. As such, gain is reported on Schedule D (after entering the transaction on Form 8949 in the space for long-term transactions not reported on Form 1099-B). If the sale resulted in a loss, you may not deduct it because a loss on the sale of personal-use property is not deductible. You do not have to report the loss transaction on Form 8949 or Schedule D unless you received a Form 1099-S for it; in that case, you must enter an adjustment on Form 8949/Schedule D to indicate the loss is not deductible.
Rules limiting loss deductions to cash investments and personal liability notes. An exception for real estate treats certain nonrecourse commercial loans as amounts “at risk.”