Join Early Retirement Today
Thread Tools Search this Thread Display Modes
Buying home from parent
Old 03-06-2010, 04:35 PM   #1
Recycles dryer sheets
Join Date: Feb 2005
Posts: 260
Buying home from parent

Hi all
I will probably be buying my grandmother's home from my dad later this year. The assessed value is $110,000 he wants to sell it to me for $80,000. I want to make sure we're both doing this on the up and up. I think from my end, there will be nothing to do except for sign the documents for the sale of the house. I think he will pay gift tax on the $30k-13k annual gift exclusion, and then have to report it as a gift on his taxes. Is it as simple as that? Will I have to do anything for my taxes as well? At closing should there be anything in writing that shows where the other $30,000 went? Thanks-

virginia is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 03-06-2010, 05:25 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Brat's Avatar
Join Date: Feb 2004
Location: Portland, Oregon
Posts: 6,559
Assessed value and market value in today's RE market may not be the same.

Years ago my parents recorded a sale of their home to my brother and his wife for $1 and love and effection. There was no gift tax involved and the house was worth more than $30,000 at the time. My sister wanted to buy the house from my parents (parents had other plans) so she filed a complaint with IRS. They told her to get a life.

Were I you I would consult a CPA.

Duck bjorn.
Brat is offline   Reply With Quote
Old 03-06-2010, 06:06 PM   #3
Thinks s/he gets paid by the post
Leonidas's Avatar
Join Date: May 2006
Location: Where the stars at night are big and bright
Posts: 2,847
Originally Posted by Brat View Post
My sister wanted to buy the house from my parents (parents had other plans) so she filed a complaint with IRS. They told her to get a life.
That put a smile on my face. Never thought I would say this, but here it is "Way to go IRS!"

I think OP may be right about the gift tax situation, but I know Brat is right in that the assessed value and what that sucker might really sell for could be quite different. Check some comps and see - heck, you might even be over-paying!
There is no pleasure in having nothing to do; the fun is having lots to do and not doing it. - Andrew Jackson
Leonidas is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
"Shielding the Assets" when you think parent will remain in your home in your care Green Jeans FIRE and Money 6 01-30-2010 09:15 PM
how to best help an aging parent FinanceGeek FIRE and Money 30 09-16-2009 05:51 PM
Thinking of Buying a Motorhome & living in it instead of a traditional home? xtradoe Other topics 31 01-15-2008 01:47 PM
Buying then renting out a vacation home? M Paquette FIRE and Money 10 01-01-2008 07:14 PM
Buying a new home,---Personal concerns! Sundance Kid Life after FIRE 12 08-02-2007 10:02 PM

» Quick Links

All times are GMT -6. The time now is 08:38 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2020, vBulletin Solutions, Inc.