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No my parents have never lived in the house. Fair market value 85,000 is what we pay taxes on. $65,000.00 is the amount I am going to pay my parents for the house. The $81,500.00 would be the $65,000.00 plus a gift of equity of $16,500.00 for the down payment.
I am new at this and the answer is fairly technical. Basically what I am trying to do is create an atmosphere where my parents have less taxes to pay and I could use the help with not paying a down payment. Could you advise me on the best route? My father is retired but my Mother still works. they are just having a tough time and if they can get more from this house legally of course. It would help pay for their house. I would appreciate any guidance you could offer. Thank you
I don't understand. I thought they would get a break on the gifted part. I was going to pay the difference in taxes over the $65,000.00.
So if they sell the house for $65,000.00 even though they paid $19,500.00 for it. There will be no capital gains tax? Because H&R Block had told my Mom there would be.