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Basis for shared rental property, only one on mortgage

Technical topics regarding tax preparation.
#1
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168
Joined:
17-Nov-2014 2:06pm
Location:
North Carolina
Afternoon! My client owned a rental home with her ex (not married). Purchase price was $100000, and they each put down $10000. Both were on the deed, but my client was not on the mortgage. They split the rental activity 50/50 on their returns, and the rental proceeds were used to make the mortgage payments. In 2021, she signed a quitclaim deed to transfer her ownership to him. He paid her $30000 in exchange. Is her basis 50% of the purchase price ($50000), or is it only what she put down ($10000), since she was not a signer on the mortgage? Does it make difference that the mortgage was secured by the home, and the payments were made from the shared rental proceeds?

Thanks!
 

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