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My father is recently deceased. He wanted us three daughters from a previous marraige to get his mother's 300 (plus) acres of land in Rockford, Alabama. He has an old will giving everything he owns to our stepmother. She is trying to figure out how to get us the land with the least amount of taxes or money involved. Is there a way the land can be legally given to us with just the three girls' names on it, for little or no cost? We think the land is worth about 600,000 dollars. What are our legal options? Our stepmother lives in Norcross, GA.

Submitted: 339 days and 15 hours ago.
Category: Tax
Value: $15
Status: AWAITING CUSTOMER ACTION

Answer

Sorry for your loss...

 

As the land was inherited - it has stepped-up basis that is a fair market value of the property at the time your father died.

That means - if you sell the property shortly after - there will not be any or a very little capital gain.

The best way from the tax prospective if your stepmother disclaim inheritance and you will be named as a beneficiary - assuming you are next-in-kind.

 

If that is impossible and your stepmother already became an owner of the property - she may quit claim deed to you - however that transaction will be considered as a gift.

As the gift value is above $12,000 per person per year - your stepmother as a donor would be required to file a gift tax return.

However she will not likely have any gift tax obligations unless the lifetime limit of $1,000,000 is reached.

In additional - if your stepmother will apply for any public benefits - Medicaid, housing assistance etc - she will be required to report the gift made within five years.

 

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Expert: LEV
Pos. Feedback: 99.3 %
Accepts: 
Answered: 12/18/2008

Tax Preparer

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