Estate Law Questions? Ask an Estate Lawyer.
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Are you saying that father is mentally incompetent?
Has he been declared medically incompetent by his doctors or legally incompetent by a judge?
Do you have a financial power of attorney for him?
Ok, then if you have a financial POA, then you have the legal authority to sell the property immediately with father's consent. With that said, you can either list the property with a realtor or if you wanted a fast sale, contact an auctioneer.
Then once the property is sold father can gift the money to you and siblings or simply agree to allow any new property that is purchased to be titled only in your and siblings' names.
If the amount of the gift is over $14K each, then he would need to file an IRS Form 709 with his taxes in the year of the gift and use up a portion of his $5.45 million lifetime gift tax exemption so he can avoid any gift taxes.
One of the things that we were wondering was whether it is better to take ownership of the house (maybe as a trust) or just sell it while it is under his name.
If it gets transferred to a trust and then sold, the trust will pay much higher capital gains taxes than if it is sold directly out of father's name.
If we sell while it is under his name and he gifts us the money what are the tax implications for him?
I went over avoiding any gift taxes in my previous post, (the part about him filing the 709 Form) but he would still owe long term capital gains taxes on the sale of the investment property. The rate is dependent on his income, but can go from 0% up to 20%.