I'm looking to buy a rental property gifting my college kid with a 1% share. Parents and kid all on the title (not LLC). When kid starts working, she will buy the property in steps. 1% then 25% then 99%. Refi into kid's name for 100% ownership. This is the way I think it works but please tell me where I don't have it right.
When share percentage changes
* Modify the % owned on the Sch E current % owned
* Just do the Sch E as before but with changed %
* Accumulate depreciation separately for parents and kid using this figure to recalculate remaining depreciation.
* Report the % ownership change to the title company. ??
* Pay excise tax and capital gain on portions bought out. ??
Is that right? Is there a simpler way without putting this property in an LLC?
