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Post by yogibearbull on Jun 11, 2023 19:00:22 GMT
A quick non-CPA opinion - a $1 sale of your interest in the house to your mother may be considered gift of the fair value of your interest, and if more that $17,000, Form 709 filing will be required. Claw-back period is 5 years for the IRS to reverse/deny all that. Let us see what the BIG firm partners say .
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sam
Lieutenant
Posts: 123
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Post by sam on Jun 12, 2023 15:06:50 GMT
I don't have any opinion whether it is good idea or not. My opinion is regarding cost of ownership or transaction cost. Your share is worth around $75K (according to your appraisal) but all legal costs, accounting cost and not to mention mediation cost (family drama). Title fees (mortgage recording and etc). All paper work regarding gift. In case any one of you audited by IRS (or even your state). Then most likely they will look at whole thing how daddy has been transferring asset or whether it was properly recorded.
Point is cost as a percentage of asset value might be quite high and only you can tell if it is worth it.
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Post by catdog on Jun 12, 2023 16:50:30 GMT
I have always told my wife to give rather than loan. Also don't attach strings to the gift. If a family member comes to me for a loan I offer to give them a portion of the amount if they can come up with the rest. We are talking children and grandchildren, if I like or approve of their situations.
I liken it to giving to charity. It always feels better for me to give money away than to spend it on myself.
Catdog
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