Transferred a property from personal joint ownership to an LLC with the same as members: Should I mark it as "sold" on 1040?

[new_to_llc]

Hello,

I am posting this question after I have read through this thread: https://ttlc.intuit.com/community/investments-and-rental-properties/discussion/rental-property-trans...

Last year in July 2021, I transferred a property that was joint owned by me and my wife to a multi-member partnership LLC with just 2 members at 50%/50%: me and my wife. The transfer was not technically a "sale"; it was just a deed transfer. So no money was exchanged.

I understand these so far:

- I need to file a 1065 for the income/deductions for the property after the LLC conversion time. I have already done that.

- I have the K-1 generated for me and my wife using Turbotax Business.

So far so good.

---

Now I am filing our personal married filed jointly 1040 taxes.

As I am stepping through Business > Business Income and Expenses, I am in this section for the property that got transferred to LLC: "Do Any of These Situations Apply to This Property?".

I don't see an option that looks like "deed transfer".

Should I pick the "Sold: I sold or disposed of this property in 2021?"

Thanks!

[tagteam · Accepted solution]

Indicate that you converted the property to personal use in the program.

There is no sale (this is a contribution to capital) provided you are in control of the LLC immediately after the transfer (which, indeed, you are).