Have a Tax Question? Ask a Tax Expert
When you "sold" your house for $1 you actually made a gift so you need to file form 709 and report that gift.
The gift tax is a tax on the transfer of property by one individual to another while receiving nothing, or less than full value, in return. The tax applies whether the donor intends the transfer to be a gift or not.
You will not pay tax as long as you have not given away more than $5.45 mil over your life but you must report the gift.
The rental is now your daughter's reporting requirement because you no longer own the house. She most likely will not pay tax either because she can claim expenses and depreciation so no rent to pay tax on. She files Schedule E. She can also claim the taxes and water bill as a deduction.
You are not taxed on the $900 she gives you. That is a gift technically from her to you.
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