jessicaphillips
Level 1
12-07-2019
02:17 AM
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My client held a rental for half of the year and then had to relinquish it to their ex wife. I have reported the rental as sold with no gain or loss on disposition to remove the rental property. My question is a restoration that was done in 2018 before the property was relinquished. It was a $6,000 expense. Can I report it as sold with the $6,000 loss? What is the best way to handle this?
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sjrcpa
Level 15
12-07-2019
02:17 AM
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No gain or loss on transfers incident to divioce, The renovation cost is part of the basis. Basis is now the other spouse's.
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rbynaker
Level 13
12-07-2019
02:17 AM
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I'd have to look up the finer points of the safe harbor, but could you elect to expense it under the safe harbor for small taxpayers?
