TaxGuyBill
Level 15

@kabbabkkg wrote:

I have a client who has sold a rental property that was never rented

The 40,000 is added to the basis to increase the basis correct? 

The gift equity is the amount of a discount on the sale price and reduce the sales price of the property? 


 

Huh?

Yes.

Yes, but as was mentioned, if there is a 1099-S you may want to shift that amount to selling costs or Basis to avoid an IRS notice.