Posted by Shawna on August 12, 2004 at 10:03:09:
Thank you for your input and advice Frank. And you’re quite correct, my folks are the best. The one time I really needed them after my divorce, they jumped in without hesitation.
Shawna
Capital Gains tax, my house/parents name - Posted by Shawna
Posted by Shawna on August 09, 2004 at 16:32:13:
My parents bought a home for me 4 years ago, long story made short… I’ve made the payments and am ready to move on to something bigger, BUT the mortgage is in their names. Every bit of the profit from the sale of my home will be mine to use for a downpayment on the next home, my parents don’t want a cent out of this. Is there any way to avoid having to pay CGT on this sale? It seems to me that since they’re not realizing the gain from this, that there has to be some fair way of doing this. Any ideas?
Re: Capital Gains tax, my house/parents name - Posted by Frank Chin
Posted by Frank Chin on August 12, 2004 at 08:23:56:
Shawna:
Sounds like from the arrangement the house is in effect an investment property for your parents, and your’re in effect paying rent by covering the mortgage.
Suggest you check into your parents doing a 1031 excahnge into a larger house. Due to 1031 requirements, this house should be in your parents name also.
They can avoid the CGT in this way.
Suggest you consult “an estate attorney” at this point to check into adding your name onto the deed, and then gifting the equity over to you on a tax free basis.
Beacuse gifting and estate issues are inter related, where the size of the estate, number of siblings etc. comes into play, its not easy to give a qucik suggestion.
Good luck, and its sound like you have very helpful parents.
Frank Chin