Posted by JOHN K HASLACH, CPA MST on May 14, 2004 at 15:10:33:
Good luck. If you have further questions, please let me know.
Transfer of Co-op from Dad to Son - Posted by Tom Coppola
Posted by Tom Coppola on May 14, 2004 at 11:46:47:
My father and I are in discussion about me purchasing his co-op, where I have been residing for the past 3 years. I cannot afford what the going sale price would be, and he is trying to give me a break. If we put a purchase price on the contract of sale, can he gift me the difference in cost between the actual sale price and the amount I would be applying for in a mortgage? If this is possible, then what is my father claiming for his taxes–the total cost of the sale, or only his gain?
Re: Transfer of Co-op from Dad to Son - Posted by Tom Coppola
Posted by Tom Coppola on June 08, 2004 at 11:09:33:
Some additional questions:
I found out that the co-op Board will approve a lower purchase price since the transfer is from father to son.
Is the difference between the appraised market value and the actual purchase price subject to state taxes?
It was also suggested that my father put the sale price as the price HE purchased it at 8 years ago, so to not show any gain on the property. Is this allowable?
Re: Transfer of Co-op from Dad to Son - Posted by JOHN K HASLACH, CPA MST
Posted by JOHN K HASLACH, CPA MST on May 14, 2004 at 13:07:48:
Not sure of all your questions. Your father can gift you an interest in the property to you. The actual gifting has no income tax consequenses, but would require a gift tax return be file. Additionally, there may be some state tax filings. The income tax issues would be the claiming of the mortgage interest expense and real estate taxes as deductions. Make sure you have an attorney help you with the filings.
Re: Transfer of Co-op from Dad to Son - Posted by Tom Coppola
Posted by Tom Coppola on May 14, 2004 at 14:14:13:
Can you explain what you mean by “gift an interest in the property”.
Also, the would a co-op Board approve the purchase price if a portion were gifted by the seller and the seller was actually receiving less than the purchase price?
Thanks again.
Re: Transfer of Co-op from Dad to Son - Posted by JOHN K HASLACH, CPA MST
Posted by JOHN K HASLACH, CPA MST on May 14, 2004 at 14:18:53:
Your father is gifting you something. From what you wrote, it sounds like he is gifting a part interest in the property, not the entire property. Perhaps I read it wrong.
Re: Transfer of Co-op from Dad to Son - Posted by Tom Coppola
Posted by Tom Coppola on May 14, 2004 at 14:23:11:
Yes, he is…or rather, may. His concerns lay in that he is wondering what taxes he will owe due to the gift.
Could you recommend any websites that offer info or guidance in this type of transfer (co-op between family members)?
Re: Transfer of Co-op from Dad to Son - Posted by JOHN K HASLACH, CPA MST
Posted by JOHN K HASLACH, CPA MST on May 14, 2004 at 14:55:15:
He will not owe any income taxes if he gifts you something. Depending on the gifts he has made in the past, there may be some gift tax due. The IRS web page has a lot of information on gifts. Check out http://www.irs.gov/businesses/small/article/0,,id=108139,00.html, but these things are too complicated to wing. I see so many cases of people who make a mess of their tax situation just to save a couple hundred dollars in professional fees.
Re: Transfer of Co-op from Dad to Son - Posted by Tom Coppola
Posted by Tom Coppola on May 14, 2004 at 14:59:14:
Thank you. This has been quite helpful.