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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10169
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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Property being sold in California of $135,000. Title in my

Customer Question

Property being sold in California for profit of $135,000. Title in my name and father. Father doesn't want any proceeds or tax consequences. How do we complete Form 593 for withholding? For "Ownership Percentage" can we simply state 0% for Father and 100% for me? Then Pay all proceeds to me and I'll get the 1099 on it?
Submitted: 5 months ago.
Category: Tax
Expert:  Lane replied 5 months ago.

SO sorry, but you can't do that unless the ownership is truly that way on the deed.

...

You camn have father quit-claim as a gift to you, prior to sale.

Customer: replied 5 months ago.
Does it have to be 50/50? I got 2 different answers from 2 escrow companies. one said yes. Other said no. I searched "Form 593 examples" online aand found this example with a 75/25 split: https://www.ftb.ca.gov/individuals/wsc/sample2b.pdf
Expert:  Lane replied 5 months ago.

It depends on the wording on the deed ... if it's jointly owned it's 50/50

Customer: replied 5 months ago.
Yikes. It's joint tenants. That requires 50% ownership to father on Form 593? He wont be happy with me.What about disbursement of funds? He has to receive half and get a 1099 for half of it too?
Expert:  Lane replied 5 months ago.

So sorry, yes UNLESS you get the quit claim done

Expert:  Lane replied 5 months ago.

A quit claim deed simply has him give up his owmership to you ... not a taxable event at al .. you're just suddenly the owner

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probably SHOULD do a gift tax form... but unless he's given away mor than $5,450,000 there no guft tax either

Customer: replied 5 months ago.
It's in escrow now. Can you still do a quit claim deed?
Expert:  Lane replied 5 months ago.

Oh, If there hasn't been a closing, technically, yes, but you need to get with the realtor and/or closing agent/title company. The sales contracts will have to be changed ... at the least will hold things up a bit.

Customer: replied 5 months ago.
Father is on mortgage with me. How about a quitclaim for partial ownership? Could we do this quickly? We are set to close in 1 week.Maybe make the split 90-10? Is this possible?
Expert:  Lane replied 5 months ago.

yep ... just do the quit-claim and file it at the courthouse

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