The house is located in Lockhart Texas. Father-in-law has alzheimers. Don't know when the house was put in his name. His wife is deceased. The property taxes was paid by another family member. No one has lived in the house for the past 4 months.
2007-06-13 06:52:19 · 3 answers · asked by Tee 1 in Business & Finance ➔ Taxes ➔ United States
You need to trace the deed on the house to the person who gave him the house. The amount paid by the donor of the house, plus the cost of any improvements made to the house, is the basis of the house (assuming it has appreciated, which it certainly has).
Assuming this is his personal residence, he will be able to exclude $250,000 of the gain on the sale. If there is gain over $250,000, then there will be a 15% capital gains tax to pay.
2007-06-13 15:00:49 · answer #1 · answered by ninasgramma 7 · 0⤊ 0⤋
Was it his primary residence? If so, the sale will have a 250k tax free gain. So if he sells the house for 400k and the house has a basis of only 200k, he will not have to pay the tax on the 200k gain. The key is determining what the basis is in the house.
2007-06-13 07:56:12 · answer #2 · answered by extra_37 4 · 1⤊ 0⤋
With current information you provided the answer I give is based on one scenario; was the house in question his main home? If he is in a rest home or medical care facility he is still considered as residing at home by the IRS. If he owned the house longer than two years as a main home it could be sold for $ 250,000.00 more than his basis in it and there would be no tax implication at all. Court house records would be able to provide a date of transfer into his name of said premises.
2007-06-13 08:18:43 · answer #3 · answered by acmeraven 7 · 1⤊ 0⤋