@quiroslr52 , while this is not really a tax preparation / filing question, , IMHO the answer depends on your aim.
(a) a gift carries with it the basis of the donor. Thus if the adjusted basis of the property to you ( Acquisition cost PLUS cost of all improvements during holding period LESS accumulated allowable depreciation during rental / income generation period ) $100,000 then your daughter's ( donee ) basis would be 100,000. So if downstream she disposes off the property her gain and taxation thereon is based on the basis of $100,000. No matter what the FMV . So it could be tax hit
(b) if on the other hand she gets it by inheritance , then the basis is with a step up to FMV ( 1/2 or full depending on the state ). And hence her capital gain and tax thereon is likely zero.
(c) If what you are doing is trying to regenerate the depreciation basis -- you have depreciated down to zero depreciation, and want to refresh by transferring, gifting won't do it. She will have to purchase it i.e. create a new basis.
That is my two cents.
