gifted property to multi-member llc

[aap]

I am PR to a newly formed multi-member LLC. The members are all children and we were gifted 3 pieces of rental property. We have an appraisal from a real estate professional. What other amounts do I need from our parents to use on our 1065?

[gloriah5200]

You will need the LLC written document/agreement.  Hopefully, this has been set up by an attorney as a legal entity.

The parents will probably need to file a gift tax return for a gift of this value given to an LLC.  

The value of a gift is generally the basis of the giver, not fmv of the property at the time of the gift.  The basis allocation of the gifts given to the LLC will provide the value of the land vs the improvements.

The value of a property from a decedent is the fmv on the date of death, but you did not say the parents are deceased.

Per IRS Publication 551, Basis of Assets:

Property Received as a Gift

To figure the basis of property you receive as a gift, you must know its adjusted basis (defined earlier) to the donor just before it was given to you, its FMV at the time it was given to you, and any gift tax paid on it.

Then, it makes a difference if the giver's adjusted basis is greater than or lesser than FMV on the date of the gift.

For additional information, please refer to the following link:

IRS Publication 551, Basis of Assets

[Carl]

What other amounts do I need from our parents to use on our 1065?

You will need your parent's original cost basis in each property. Their original cost basis is what they paid for the property when they originally purchased it, plus the amount they paid for any property improvements during the time they owned it. This will be used to determine "your" cost basis in the property.

You will also need the total amount of depreciation taken on each property, during the period of time your parent's owned it. Whatever cost basis is figured for each property, must be reduced by the amount of depreciation already taken on that property.  Only the structure value is reduced, not the land value. This is because land is never depreciated.