USA Basis question


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The situation: 3 siblings inherited rental properties many years ago. After years of wrangling they finally settled on dividing the properties. In the settlement each received more or less certain properties equal to their one-third share of the total inheritance.

Is there a taxable event as a result of the transfers of title among the inheritors? If so, what is the basis of the properties? If there is no taxable event, presumably the basis would be FMV on the date of death of the parent.

Further, in the exchange, one of the siblings was given extra consideration due to an opportunity loss; a property which could have been rented out was not. The sibling who was the custodian of the property failed to rent it out and lost money for the others by letting it go unused. Does this part of the settlement trigger a taxable event? I.e., rental income or just miscellaneous taxable income?
 
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