Real Estate Law
Have Real Estate Law Questions? Ask a Real Estate Lawyer.
Hi and welcome to JA. Ray here to help you today.Please bear with me a few moments while I review your question, conduct and prepare your response.
You would only owe capital gains here on your half if there was a gain from the date he added you to the deed.If there was gain here it likely isn't going to be that big.His estate is going to have a final return, it may be possible for him to claim virtually all the gain from when he bought it here until sold.If he resided in it for 2 out of last 5 years the gain for him and his estate is likely to be exempted.
Ownership and Use Tests
To claim the exclusion, you must meet the ownership and use tests. This means that during the 5-year period ending on the date of the sale, you must have:
If you have a gain from the sale of your main home, you may be able to exclude up to $250,000 of the gain from your income ($500,000 on a joint return in most cases).
I appreciate the chance to help you today.Thanks again.
You will have gain here on the property.It would be from the time you got half here and you owe for that gain to the time you sell it.The basis here is when you got your half.The father here who deceased would need to report the gift to you on his last return if the half here was more than $14k.Even though he deceased he would have a return due to account for the gift.You can look to the tax value at time he gifted it to you by deed.Your gain here if you only got half would be from that point to time of sale divided by half.Now if you got the other half here say by will there will be a different basis for that half.
The basis starts when you got title either for the first half or if you inherited the other half.If someone else got the other half here they owe when they sell it for that half.Again the basis starts when they get it and then how much it sells for later on as to what capital gains you owe.
Under current rates depending on your bracket you may owe 15-20% on the gain here, or your share of it.And the laws do change.Don't know if living in it is possible but that would be the way to dodge gain here.You live in it 2 years, sell it in 5 years,
Gift here is under $5,450,000 no taxes on it, he will need an estate opened and executor appointed by court if he died with this half interest.It passes to his legal heirs under laws of intestacy if there was no will and you each own half here.
Laws of intestacy
If you die with:
here’s what happens:
The Spouse’s Share in Washington
In Washington, if you are married and you die without a will, what your spouse gets depends in part on how the two of you owned your property -- as separate property or community property. Generally, community property is property acquired while you were married, and separate property is property you acquired before marriage. There are a couple of big exceptions: Gifts and inheritances given to one spouse are separate property, even if acquired during marriage.
Executor would file his last return here.You would need to resolve this other half here if there are heirs otherwise you are stuck with a tenants in common situation with other owners.You would want clear title before you keep paying on it.
Thanks again, sorry for your loss of father.
Ok so you own it all no probate here.There will be a split cost basis when you sell it and pay taxes, one is calculated from date of deed and second half from date of death when you inherited the second half.Honestly this is such as a short period the halves and taxes for each will not change that much.If you live in it for 2 years, sell it in 5 you skip capital gains here entirely in all likelihood.
I appreciate the chance to help, please let me know if you have more follow up.If you can leave a positive rating when we are done it is always sincerely ***** ***** with the remodeling.