Property Depreciation

Forum|Forum|5 years ago
April 19, 2021
4 replies
30 views

Taxpayer purchased a property for $120,000, he then granted this property to his wife's LLC for $100. Would the LLC be able to claim depreciation for the cost of the property ($120,000) ?

P.S. If the LLC cannot claim the depreciation, would he claim this property as a loss? If so, where would this "loss" go?

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qbteachmt

Level 15

What is "granted?"

What is "Property?"

Why does she have an LLC? What type of property is this? Is he a partner in that LLC?

All of this is too vague to help; details matter.

Don't yell at us; we're volunteers

L

LaraMultiservicesAuthor

Level 3

He gave the LLC the property for $100 (granted). It's a commercial property and he is not a partner in that LLC.

IRonMaN

Level 15

Use the $120,000 as her basis for depreciation.

Slava Ukraini!

sjrcpa

Level 15

No gain or loss is recognized on transfers between spouses.

No gift tax consequences for gifts to spouses, as long as both are US citizens.

The more I know the more I don’t know.

BobKamman

Level 15

Sounds like he's trying to stay one step ahead of creditors. The $100 is probably the traditional $5 "and other valuable consideration" found in quitclaim deeds, but with inflation. I would put this file in the "get your fees up front" stack.