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Well, the good news is that there is no tax on this gift either for you or for your parents.
Your parents would be required to file a gift tax return on Form 709 (it is due when their income tax return is due) for 2013, in 2014.
There will not be any tax due.
At this point there is no gift tax until taxable lifetime gifts exceed $5,250,000., each.
There is no tax of any kind levied on you as the recipient of the gift.
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Hi Stephen G. So if I understand you correctly, you are saying no tax payment of any kind on my parents as the Grantor's. Also for myself the Grantee no tax will be due, not considered income? Would that be due to them living in the home or is just the way it is?
No. It wouldn't matter where they live. In fact, since they haven't given up possession of the home as they still reside there, there's a question as to whether or not they have made a gift at all.
But that won't matter now
It's best to start the clock running on the transfer now in case they have to go to a nursing home and qualify for Medicaid.
Aha because after all they are getting to live in a home rent free and maintenance free. About the transfer, it was done last week, thats why I had high urgency on this question. Thank you very much, I appreciate your timely response..
OK. you have nothing to worry about
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