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TaxRobin, Tax Preparer
Category: Capital Gains and Losses
Satisfied Customers: 14842
Experience:  15+ years in Tax preparartion as well as Instructor for tax law, theory, and application
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If I am transferring rental properties to a family member,

Customer Question

If I am transferring rental properties to a family member, do I pay capital gains taxes?
JA: I love the idea of making big money with investments, but there are so many things that could go wrong. The Accountant will be able to help you. Please tell me more, so we can help you best.
Customer: Do I have to pay capital gains tax when transferring rental properties to a relative?
JA: Is there anything else important you think the Accountant should know?
Customer: No
Submitted: 9 days ago.
Category: Capital Gains and Losses
Expert:  TaxRobin replied 9 days ago.

Hello, I'm Robin. Welcome to JustAnswer. I'm reviewing your question now and typing up my reply. I'll post that in just a few moments.

Expert:  TaxRobin replied 9 days ago.

No you would not because it is not a sale. You would need to file the form 709 to report the gift.

The person that you give these to would need to keep your cost. In other words their cost now is your original cost less depreciation claimed. If you have been depreciating the properties for a while their cost may be close to $0.

When they sell they would need to pay the tax on the sale.

If they continue to use as rental they start with the adjusted basis (as I described above) they cannot in any way use fair market value.

Please rate in a positive way (look for the STARS ) so I am credited with responding.

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