Sale of Second Home

[dbridges48]

In 1995, my wife and I gave my mother in law money to purchase partial interest in a beach condo on our behalf but the property was put in her name. 

The property remained in her name until 2003, at which time she transferred ownership to my wife.  The property had appreciated by approximately $10K over that time period.

In 2021, my wife sold the property for a profit.  For tax purposes, what would be the proper value for us to use to calculate capital gains?  The value in 1995 or the value in 2003.

[Mike9241]

it would be the purchase price in 1995

plus the basis of any improvements your mother made from 1995-2003

plus the basis of any improvements your wife made until sold.

however, the answer could change depending on who used the property from 2003 until sold and if it "rented" was Fair Rental Value Charged

[dbridges48]

Was not a rental property, so not an issue.  The property was for personal use only.

Improvements were shared with other owners. But, the portion of those costs could be added to basis, right?

[JohnB5677]

Yes, You can include improvements (not repairs) in your basis calculation.  

When you have a group involved, or you own a condo you can include the capital improvement pro-rata share of the cost to your adjusted basis. If you have a homeowners' association they should be able to tell you how much this is.