My client received a Truck distribution from his S corp. I recorded the property distribution on the K-1 and the deemed sale at FMV. The truck is fully depreciated. The Kelly Blue Book value is $9500. On the same day as the distribution, the shareholder traded in the Truck to purchase a Toyota. The Retail Sales Contract at Toyota shows the trade-in at $13500. The client says the Trade-in value is inflated because they negotiated dealer fees and the dealer increased the trade in to reduce the final cost. Do I need to show the Trade in (Sale) of the Truck to Toyota for $13500 with basis of $9500 on the personal Form 8949? Or, not show the sale at all, and assume the Truck was sold to Toyota for the Kelly Blue book value?  I have heard that dealers play with numbers and the Trade in value can be manipulated to "make the sale."