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Subject:  Re: question ... Date:  6/21/2013  3:15 PM
Author:  TMFPMarti Number:  118726 of 121599

But one strong motivation for her to do it this way is that she received a payout when we did this. And we really need the cash.

But now I'm thinking about taxes. Should I just record it as sold --at this fractional price -- and recapture all previous depreciation; this will probably generate a pretty big tax loss. And then, assuming we buy it back in six months, do I start depreciating it all over again, and also record a new (and fractional) cost basis? That would generate a huge taxable profit when we sell it, as we plan to do.

The way the tense keeps changing I can't figure out whether this is something you're contemplating or have already done. Hopefully it's the former because I wouldn't touch this arrangement with a barge pole without legal and tax advice up front. It's potentially dangerous territory when you engage in a transaction that isn't really what it looks like on the surface.

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