The fact that you client gave $400k, doesn't mean that it was spent on the property.  What if the property was $375k and the kid pocketed the rest.  Or conversely what if the kid kicked in $10k of his own money. The properties basis is the lower of current FMV or the original purchase price plus improvements less depreciation.

I recently encountered a CPA who thought that the partnership redemption should be reported in 9a, after an unproductive phone call with him, is sent him his K-1s back with copies of the Forms 8082 I filed with my clients tax returns.

I do not believe that canceled debt is taxable to a guarantor.  The reason being that, the guarantor would have recourse against the original debtor, and therefore the canceled debt would result in a deductible expense (bad debt) and therefore would not be included in income - see IRC 108(e)(2). https://www.law.cornell.edu/uscode/text/26/108 I also believe that it would be incorrect to issue a 1099-C to a guarantor as per 1.6050P-1(d)(7) https://www.law.cornell.edu/cfr/text/26/1.6050P-1 Substantial authority is hard to come by, but this letter from the IRS references the relevant case law: https://www.irs.gov/pub/irs-wd/02-0024.pdf