property buyout between mother and daughter

kwelch0424 · ‎February 20, 2022

My daughter and I bought a house to use as a vacation rental March 2020. The first date of service was 6/15/2020. She bought me out effective 6/1/2021. My owner's equity was $63K and she paid me $113K due to the rapid appreciation of the property in the area. There is an option for gifting it to her but if we don't do it that way, how do I record this transaction in TT? We originally purchased the property for $490K and agreed the FMV at the time of buyout was $600K. Thanks for any help with this!

JamesG1 · ‎February 21, 2022

Click on the magnifying glass in the upper right hand corner of the screen and enter 'sale of business property'. Enter.
Click on 'jump to sale of business property'.
Follow the directions on the screens to report the sale.

Have you been reporting rental income since 06/15/2020? Have you been depreciating your portion of the asset since 06/15/2020

Are there any passive rental losses that you need to report?

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

kwelch0424 · ‎February 23, 2022

Hi James,

Thanks for your reply. Yes, we have been reporting it as rental income since June 2020 and depreciating and there are no passive rental losses.

The more I look at this, I don't see why I can't just record the sale as being $113K which is what she paid me. We estimated the FMV from like properties and Zillow. We did not obtain an appraisal because it was just a year after we purchased it. I don't have any expenses to report for the sales information.