Have a Tax Question? Ask a Tax Expert
Hello and thanks for trusting me to help you today. I am a tax adviser with over 15 years of experience.
If you sell you would need to pay tax on the gain. That would be the difference in your sale price and the amount your father purchased for (plus any improvements).
The sale to you for a $1 was really a gift. So you retain your father's basis in the property.
You would pat tax on the gain (difference in basis and sales price). Indiana has a rate of 3.4% and the federal would be dependent on your income .
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so if he paid 320000 and i sell for 30000 i would owe no tax
That is correct, you would pay tax if there is a gain.
thanks so much
You are most welcome