I think that you are saying that you believe that the loss on sale of the rental property is over-stated.
Are you reporting rental income on Schedule E Supplemental Income and Loss and the Federal 1040 income tax return or on something else?
If you are reporting the rental income on a Federal 1040 income tax return, are the two owners of the rental property listed as the primary taxpayer and spouse on the Federal 1040 income tax return?
If you are reporting the rental income on a Federal 1040 income tax return, are the two owners of the rental property listed as taxpayers on two different Federal 1040 income tax returns?
Please clarify.
If the two owners of the rental property are listed as taxpayers on two different Federal 1040 income tax returns, the rental property asset on each tax return should report only 50% of the true cost of the rental property asset.
For instance, if A and B own rental property C with a cost basis of $200,000, A and B should each capitalize and depreciate asset C at $100,000 on their individual Federal 1040 income tax returns. A and B would report one half of the selling price on their individual Federal 1040 income tax returns to accurately report their gain or loss on sale.
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