A2A.The answers by Wray Rives and Kelly Wallace cover where you report it. The only thing left is for you to determine your basis. In this case, your basis is the lower of the gifter's basis in the calf and the fair market value of the calf at the time your wife received it. You increase your basis by any expenses involved in raising the calf.As an example, let's say that the gifter raised the calf from birth, and donated it to your wife when the calf was a year old. The gifter's basis in the calf would start at zero, and be increased by any expenses incurred in raising the calf during the first year (say, $20,000). At the time of the gift, if the cash value of the calf on the market is $30,000, your wife's basis would be $20,000; if the cash value were $15,000, that would be your basis. You would add any of your own expenses in raising the calf during your period of ownership, and then compute the gain using the adjusted basis, reporting it either on Form 4797 or Schedule D as appropriate.You will need to get a statement of basis from the person that gifted your wife the calf so that you can support the claimed gain.EDIT: misread the question. Your basis in the calf would start at zero, since you were gifted the mother of the calf, and would be adjusted for any expenses you had in raising the calf to the point at which you sold it.