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In 2024, a client quit claimed a rental property (that he owned for the past 5 yrs) to his parents for $10. The original cost of the property was $100,000 and accumulated depreciation was approx $18,000 as of the date it was transferred to his parents.
I assume that my client would not be able to deduct the loss but can't find how to indicate that it was a related party sale on the 4562 worksheet. Any help would be appreciated.
Maybe I would just enter a "disposition" date and not indicate any sales price?
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My interpretation of what you have stated.
the transaction is Not a Sale
Yes it is a gift which (probably) requires filing of a 709
Parents Basis is the same as his (depreciated ) basis.
In my experience it is unlikely the $10 ever changed hands.
