Tax

Have a tax question? Ask a tax Expert

Ask an Expert,
Get an Answer ASAP!

This answer was rated:

My parents are elderly and own a 108 acre farm in Wiscosnin…

My parents are elderly...

My parents are elderly and own a 108 acre farm in Wiscosnin that they bought in 1954. We created a revocable trust that holds the farm. My brother wants to buy 20 acres. My question is this: My parents bought the farm for $45,000 and maybe put another $20,000 into it. We are thinking of selling the 20 acres to my brother at $65,000.00 This is the current assessed per acre value per their property taxes . My parents are ages 102 and 95. What would be the tax consequence of this sale?

Show More
Show Less
Ask Your Own Tax Question
Answered in 11 minutes by:
3/19/2018
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 32,650
Experience: Taxes, Immigration, Labor Relations
Verified

First of all - I suggest to verify if that is a revocable trust - if so - all assets held in the trust are still considered as owned by your parents - and the sale transaction will be reported on their tax return.

You will need to allocate the basis to that parcel they plan to sell - and will calculate the gain.

That will be long term capital gain - taxable at reduced rates - depending on their income - it may be partially taxed at zero percent and partially at 15%

.

If indeed - that is an irrevocable trust - the trust will report the sale transaction - and while tax rates are same - tax brackets are normally higher for the trust compare to physical persons.

On the other hand - when proceeds are distributed to beneficiaries of the trust - the taxable gain is passed as well - and not taxed fro the trust - instead - it will be taxed for beneficiaries.

Let me know if you need any help with reporting.

Ask Your Own Tax Question
Customer reply replied 1 month ago
Thank you

I appreciate if you take a moment to rate the answer.

Experts are ONLY credited when answers are rated positively.

If you still have any doubts, need clarification - please be sure to ask.

I am here to help you with all Social Security / Tax related issues.

Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 32,650
Experience: Taxes, Immigration, Labor Relations
Verified
Lev and 87 other Tax Specialists are ready to help you
Ask your own question now
Was this answer helpful?
Ask Lev Your Own Question
Lev
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 32,650
32,650 Satisfied Customers
Experience: Taxes, Immigration, Labor Relations

Lev is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,338 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,451 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

PhillipsEsq.

PhillipsEsq.

Attorney-at-Law

56 satisfied customers

B.A., M.B.A, J.D.

Robin D.

Robin D.

Senior Tax Advisor 4

15,124 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,655 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

< Previous | Next >

Related Tax Questions
Looking for estimated tax rate for 500,000 income in 2017.
looking for estimated tax rate for 500,000 income in 2017 … read more
Richard
Richard
Tax Attorney
Doctoral Degree
4,451 satisfied customers
How is land from an estate reported on a beneficiaries K-1
how is land from an estate reported on a beneficiaries K-1 … read more
Dr Arthur Rubin
Dr Arthur Rubin
Doctoral Degree
24 satisfied customers
Are beneficiaries required to report K-1 credits on the Form
Are beneficiaries required to report K-1 credits on the Form 1040, or is at our discretion? I'm using TAXACT software. The Form 1041 K-1 Final Year Deductions only shows credits on Line 11 A and C. Th… read more
PDtax
PDtax
Owner
Master\u0027s Degree
1 satisfied customers
I have a question about -term capital gain tax rate for 2018
I have a question about long-term capital gain tax rate for 2018 for an investment property … read more
Barbara
Barbara
Enrolled Agent, Paralegal
4,906 satisfied customers
Must file a 1041 what are the tax rates? estate got a1099r
estate got a1099r for a deferred annuitiy for $10,690.84 … read more
Lev
Lev
Tax Advisor
32,650 satisfied customers
I have a question about term capital gain tax rate for 2018.
I have a question about long term capital gain tax rate for 2018. I bought a commercial property under my name and held on to it for 4 years. I sold it in January 2018. I filed my income tax return fo… read more
Barbara
Barbara
Enrolled Agent, Paralegal
4,906 satisfied customers
Tax rate on stored company property in Theodore, Alabama and
Tax rate on stored company property in Theodore, Alabama and do you pay property tax on 100% of the value. (Stored off shore oil and gas equipment/tools)… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
15,124 satisfied customers
What is the tax rate of capital gain when I sell the rental
What is the tax rate of capital gain when I sell the rental property in the regular yearly income tax bracket of 10-15%? … read more
Carter McBride
Carter McBride
LLM
957 satisfied customers
GILTI tax. According to new tax bill, what is the tax rate
GILTI tax. According to new tax bill, what is the tax rate for GILTI income of a foreign corporation owned by a US individual?… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
15,124 satisfied customers
Do I report (in kind) stock transfers to beneficiaries of a
do I report (in kind) stock transfers to beneficiaries of a residuary trust as it closes out in 2017? Stock transfers took place late last year and assumed date of death basis. remaining fractional sh… read more
Lev
Lev
Tax Advisor
32,650 satisfied customers
Didnt report income from the sale of asset but it wouldnt of
hello. didnt report income from the sale of asset but it wouldnt of changed my taxes for the year as I had a large tax loss for the year. Is there still a penalty for this type of omission? should I a… read more
Chad EA, CFP ®
Chad EA, CFP ®
IRS Enrolled Agent, CFP(R),
Master\u0027s Degree
2,026 satisfied customers
What would the rate of capital gains tax on income property
what would the rate of capital gains tax on income property held for 25 years by an owner who of late had and will have income of less than20,oooIt is also my understanding we (my brother and I) are e… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
15,124 satisfied customers
My question is how to change the tax rate on the Panasonic
My name is ***** ***** My question is how to change the tax rate on the Panasonic 7500? thank you … read more
taxmanrog
taxmanrog
Master\u0027s Degree
897 satisfied customers
Will the new tax rates for businesses apply to sole
Will the new tax rates for businesses apply to sole proprietor medical practices? … read more
emc011075
emc011075
Senior Tax Specialist
Bachelor's Degree
16 satisfied customers
Assuming a Medicare tax rate of 1.45% and monthly gross
Assuming a Medicare tax rate of 1.45% and monthly gross wages of $2,500, the amount recorded in Medicare Tax Payable for one quarter for the employee's payroll deduction is… read more
taxmanrog
taxmanrog
Master\u0027s Degree
897 satisfied customers
What are the taxes rates 2016 for term gains in irrevocable
what are the taxes rates 2016 for long term gains in irrevocable trusts … read more
Chad EA, CFP ®
Chad EA, CFP ®
IRS Enrolled Agent, CFP(R),
Master\u0027s Degree
2,026 satisfied customers
Can I report rental income in my tax return on a property
Can I report rental income in my tax return on a property thar is owned by my father? He does not live in the US is not a US citizen and can sign a document to allow me to receive the rental… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
15,124 satisfied customers
Given that the current 1041 tax rate on 401(k) income is
Given that the current 1041 tax rate on 401(k) income is $3206 + 39.6% over $12,400, what will be the new tax rate and will it apply for 2017?… read more
PDtax
PDtax
Owner
Master\u0027s Degree
1 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x