how to split capital gain tax with partner

[Ting Liu]

I bought a building with a partner several years ago. But the building and loan were both under my name. My partner was not on any official record. Recently we sold the building. I'm just wondering how to handle the capital gain tax between me and my partner. Thanks!

[Ashish Acharya]

@Ting Liu Since the building and loan were in your name, the IRS considers you the sole owner for tax purposes, meaning you’re responsible for the full capital gains tax. You can settle privately with your partner based on your agreed ownership split, but you will handle the entire tax liability. After paying the tax, you can transfer the proceeds to your partner.

However, Technically you should have filed partnership tax return where he would have recognized his portion of yearly activities and sale at the end.

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