I own raw land with two family members on which we received an offer that we would like to accept. Family member #1 & #2 would like the sale/gain to be recognized in tax year 2024. Family member #3 would like the sale to hit their taxes in 2025. If we have the deal close on 12/31/24, with funds transferred to family member #1 & #2 on that day, and to family member #3 on Jan 1 2025, would family member #3 be able to defer the sale & gain to 2025? Or would they need to have a separate sale?
The different timing desires is due to timing of other investments/income recognition for each of the family members...
Thanks.
The question is can the second family use the installment method of reporting? if they can then they can report the sale in the year they receive the proceeds. however, the issue is one of constructive receipt. if the holder of the funds is a rep of the family or the family has control over the funds, then I would say they have constructive receipt on the date of closing - no installment sale. I can't say if it's possible to do two sales if the property is undivided, see a real estate lawyer