Client co-owned a rental with another person (50/50). With permission, client reported 100% of the rental income and expenses including depreciation on his returns for about 10 years. They sold the property in 2020 and each received a Form 1099-s for 50% of the sale proceeds. How to report the sale on each of their returns.
Did that one client actually receive 100% of the income and pay 100% of the expenses?
If not, both taxpayers may have 10 years of incorrect tax returns. Even if the one person did 100%, it could depend on how the title of the property was held, as well as local state law.
Did both people actually purchase/pay for the house 50/50? Did they actually receive 50/50 of the proceeds of the sale?