I co-own a rental property with 2 other siblings. Two of us would like to sell the property and the third one would like to keep it. We decide to sell our shares to the third sibling. Does this consider a rental property sale within TurboTax? Within TurboTax, I saw a choice of "I sold or disposed of this property", however, in the details, it said "Do not check this box if the disposition was to a related party." What should I do?
It's a loss problem with passive and capital losses coming into play. If you sell to a relative you can't recognize those losses BUT you must recognize gain. Are you selling to the sibling at FMV? You should not get in to a bargain sale thing and you should get tax and legal pros to help with this.