The rental house fair market value was $557,000 when she was court ordered to give the house to her ex.  The mortgage owing was $268,000 and was only in my clients name.  The title was in both their names.  The divorce was final a year before the home changed hands but they went back to court a few months before the home for this court order.  My client received only $268,000 when he refinanced the home.  So she says she sold it at a $289,000 loss and wants to take that loss (of course after recapturing her depreciation) and carry it forward for a couple years.  I am torn.  I think she should only value the house at $278,500 (half of the $557K) since the title was in both their names but then again...I'm not sure.  Her argument is that she bought the rental house on her own she says right before they were married (but the title she says was in both their names?).  They were only together about 2 years.  BTW....her recapture of depreciation is almost $24,500 if that comes into play here.  Any help on this would be greatly appreciated.  Thank you ahead of time.  Give me all your great wisdom please oh wise-ones in the community!