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I would appreciate any direction this board can provide on the following questions. I am trying to assess the wisdom from a tax standpoint of gifting real estate interests to family members. Suppose an individual has income real estate that he has held for decades. Most of the real estate was purchased, but some was inherited. All of the real estate has appreciated in value and the income generated has increased as well. If the individual now wants to divide up the real estate and gift out percentage interests to to family members, how are the gifts valued for the purposes of the gift tax exemption? Does the individual's basis control or is the present value or some other value used? I know that the individual cannot gift more than $11,000 (this year) to any person without incurring tax liability and I would not want to trigger any tax to the individual making the gifts. Besides gift tax, are there other possible tax consequences I should look into? Thank you!
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