Heres some info
I'm selling my house to friend for 24k, but it will be done in 4 years.
Ill recive $2400 the first month and the house will be payed in 4 years, ill still have the deed and he'll get it when i recive the whole amount, also if he stops payment for whatever reason all the money he gave me will be considered as rent and he will lose the option to buy.
Now heres the problem his wife came and told me to tell the lawyer that im selling the house at a much lower price then i am, at 5k.
She says that it will help at taxes. And then to make a different contract with him telling that he owes me 24k for some other reason or such.
Now i told her that its illigal, but i dont know the law.
Can you guys help me, i live in PA.
Can you guys give me the law so i can shove it down her throwt, so she'll stop bugging me with this.
2007-08-03 10:51:03 · 9 answers · asked by mike c 2 in Business & Finance ➔ Renting & Real Estate
Details
Its in a small town in PA, it the part of town my house is at most other houses are aroun 20-30k
Also like i said he can scam me since he doesnt get thr deed until i recive the 24k, if he stops payment all the money he put towards the house will be considered lost.
2007-08-03 11:07:13 · update #1
Just tell her that misstating the valuation of a home in order to reduce the amount of taxes owed is called TAX FRAUD and that you will not be a party to defrauding the government and have to go to jail for it.
2007-08-03 11:04:22 · answer #1 · answered by gkk_72 7 · 0⤊ 0⤋
That is just shady - what you would have is a deed that would be transferred after the 5K payment and no proof that more is owed on the house - and an unsecured loan for the remaining. Let your attorney handle the whole thing - and double check with him/her that you are getting fair market value and fair interest. If this is a rental home that you have not lived in 2 of the last 5 years, then you will be taxed on just the gain you receive each year - not on the total sales price. Once you take a larger down payment (I think 20%) you are taxed on the entire gain during that year. If this is the sale of your home - it doesn't even come near the one time gain for people over 56 (think that is the age cut off) - and if you are moving into another house, it probably will not be any cheaper than this sale so you would not be taxed on your gain. So your buddys wife is to be watched carefully.
2007-08-03 11:05:44 · answer #2 · answered by justwondering 6 · 0⤊ 0⤋
The tax benefit is irrelevant, You are exempted from capitol gains,and you can only be taxed on gains in value when the propety is sold. the extra money spread over 4 years, is not going to make a difference on your taxes. To risk tax fraud for basically no benefit is just not smart.
I would geta real estate lawyer to draw up the contract though, it will cost a couple hundred, but the piece of mind will be worth it.
2007-08-03 11:25:05 · answer #3 · answered by Ron B 3 · 0⤊ 0⤋
And what is she going to save by getting you involved in this illegal activity, $100 a year? Just say no.
She is a whack.
Make sure you get this contract reviewed by an attorney. Anyone that would risk a federal offense over a couple hundred bucks would trip their grandma to get the best piece of watermelon. She would surely try to slit your throat on this deal.
2007-08-03 15:28:26 · answer #4 · answered by godged 7 · 0⤊ 0⤋
Ever heard of a freelance-for-deed? it extremely is akin to leasing the residing house different than that the money that is going into paying the month-to-month hire/loan (regardless of quantity the two events comply with) would be utilized in the direction of the completed purchase value on the time whilst the finding out to purchase occasion is able to purchase the valuables outright. That way, you (the seller) might have your month-to-month loan paid (or a great ingredient to it) with the aid of the customer, and the customer would be paying down the completed purchase value with the aid of making the month-to-month money. they do no longer lose out on the hire earnings besides, except they no longer can arise with the money for the money. if so, you will kick them out and the residing house nevertheless belongs to you the owner. interior the completed technique, the owner keeps criminal identify to the valuables on an identical time as the customer in basic terms features equitable identify till he will pay off the loan on the residing house.
2016-10-19 09:07:57 · answer #5 · answered by ? 4 · 0⤊ 0⤋
What kind of house can be purchased for $5000, or even $24000 in this day and age.
UH..sell your house through proper channels. Are you a bank?? Do you know what your friend's credit rating is?
I think you're in the process of being scammed.
2007-08-03 10:59:02 · answer #6 · answered by zanthus 5 · 0⤊ 0⤋
dude I would get a lawyer to take care of this deal.
as for help at taxes heck owning the home will help with taxes.
a little anyways.
don't let your self get scammed
2007-08-03 11:05:03 · answer #7 · answered by EviL 6 · 0⤊ 0⤋
You should walk away-just reading your description of this situation made me feel dirty and in need of a shower.
2007-08-03 11:11:24 · answer #8 · answered by Jamie G 2 · 0⤊ 0⤋
Yes, it's illegal. Don't sign it.
2007-08-03 12:03:22 · answer #9 · answered by Expert8675309 7 · 0⤊ 0⤋