Posted by raelynn mitchell on November 29, 1998 at 11:18:20:
someone who inherits property gets to tell the IRS they received it at the fair market value at the time of decedent’s death. If they in turn SELL at market value, they have no taxable gain. Their giving the property away can create problems, as any gift above $10,000 per individual is most likely considered a taxable gain and the IRS expects the giver to pay the tax. If they SELL it to you, however, it’s a different ballgame. If they were to sell to you, carry a note and forgive $10,000 worth of the lien per year per individual they MAY avoid the gift tax. But YOU would have taxable income to the IRS, as a forebearance (sp?) of a loan is considered income to the receiver.
No, I’m not a CPA, so find a good CPA and real estate attorney ASAP - preferably before receiving title - because there’s gotta be a creative way to structure this so that the IRS doesn’t get “rich” yet everyone’s goals are met.