Hi,
I’m asking for a friend:
I own residential rental property 50/50 with a partner. If we sold the property, is there a rule about how it gets reported on taxes? Could either of us choose to report the sale and capital gain to the IRS or do we have to split it 50/50? This property is in the United States.
I think each partner needs to report their portion of the sale.
The only hiccup I could see is if all of the paperwork anyway is under one partner’s name and social security number. Are both partners on the title and everything including any mortgage obligations?
Assume both person’s names are on everything.
Then this would make sense.
Thanks guys. Is there some kind of IRS instruction pdf to read about this?
Maybe this??? Or use the industrial strength Turbo Tax version???
How was the rental income reported in previous years? I think IRS can deduce the percentage of shares from the previous tax return.
If there was no previous tax filing on rental income, I think the share split is up to the partners. It would be more about partnership agreement.
So is the accountant or Turbo Tax cost cut too???