I have a question regarding capital gains
and if I will have to pay them.
In November 2015 my mother signed over her home to me (I believe it was with a quit claim deed with wording that said I was buying it for $10). The house is fully paid for. The reason we did this is because my father died in August 2015 and my mother was needing to be placed in a home due to her dementia. We were applying for VA Aid & Attendance for my mom, but in order to qualify she could not have the house in her name. My parents have owned and lived in the home since 1960. They originally paid about $25,000 for it.
The plan was for me to sell the house once it was put in my name and use the money to pay for my mother's care. Fortunately we just received an offer of $170,000 for the house, but my husband just mentioned we may have to pay capital gains. I have 4 days to accept this offer, and we are in desperate need of money from the house sale to continue to pay for my mom's care in the memory care home she is now in. My husband & I both receive social security only- we have no other income
. But if I have to pay a huge amount with capital gains I won't have enough money to pay for care for my mom until her death!
Are there any options to avoid paying capital gains? It is a very remote possibility that my mother could live with my daughter for awhile, but eventually she would need placement again when the dementia worsens (ie. for safety issues). I could hold on to the house, but it would not be my primary residence, and if I kept it I would really need to rent it in order to have enough funds to pay for my mother's care.
I'm praying you can answer this question quickly, and provide as many scenarios as possible to help me make the best decision. We are located in Tucson, Arizona (so is the home).
Thank you for your time.