I will 4th the suggestion to get some professional guidance in this area.
Partnership tax can become complicated very quickly, and you just entered that complicated zone.
While it appears that you are more interested on issues related to the personal tax return, I have a few comments on the partnership component:
- You indicate "I" transferred "my" rental property to a newly formed partnership.
- You don't indicate how many partners, relationship to the new partners, etc.
- When contributing property to a partnership, this brings a number of tax issues into the picture
- The partnership "steps into the shoes" of this property so make sure you have your current depreciation schedules.
- You will also need to know the FMV of the property. This comes into play in determining the economics of the partnership interest and also allocation of gain / loss upon disposition of the property by the partnership
- There will most likely be a special allocation with respect to depreciation. Although you don't mention who the other partner(s) is, which will impact this tax provision.
- Is there debt associated with the property? How is that being handled?
- You technically don't have a "non-taxable disposition". You have a transfer of the property where there is no gain or loss. You technically still own a portion of this property through the partnership.
Maybe you have already decided to get help on the partnership side of the transaction, if so, excellent. If not, I strongly recommend it.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
