2007-12-14 10:10:54 · 9 answers · asked by BB 2 in Business & Finance ➔ Taxes ➔ United States
Look at the first answer if you don't want to pay tax on it. DO a 1031 exchange, meaning you roll that money into other like kind property to delay taxes.
The other thing you didn't mention though was your parents' basis in the property. What did they get it for? What was it worth when you got it? There might be a chance that you will have to pay minimal taxes or none at all based on your parents' basis in the property.
2007-12-14 13:07:53 · answer #1 · answered by Dom 5 · 0⤊ 2⤋
If the brief sale cost is decrease than you paid for the homestead then there is not any benefit. whilst it incredibly is in many instances the case it is not constantly so. i've got dealt with a pair interior the previous few years the place the homestead were paid off and the landlord took out a private loan to fund different issues including holiday trips (dumb) vehicles (very nearly as dumb) or a business company start up-up (purely semi-dumb) however the brief-sell cost grew to become into extensively bigger than the unique purchase cost 20 to 40 years till now. if so, the regulations on the sale of a private place of residing kick in and can keep away from capital useful properties taxes. in between the instances that I dealt with, the homestead grew to become into an investment belongings and the landlord grew to become into hit with significant capital useful properties tax incredibly as quickly as the depreciation recapture grew to become into taken into consideration. it incredibly is thoroughly cut loose the cancellation of debt earnings and there is not any way around it. Insolvency with connection with the canceled debt is thoroughly cut loose any capital useful properties tax subject concerns. interior the worst case difficulty you will have the two a taxable capital benefit and COD earnings that could no longer be excluded. it incredibly is a incredibly uncommon difficulty yet isn't impossible via any potential. without understanding each and all the appropriate numbers and information on your case it is not feasible to declare if there could be any capital useful properties tax due or no longer. in maximum instances you will not, yet it is the perfect feasible answer with the minimum suggestions obtainable.
2016-12-31 11:32:47 · answer #2 · answered by kerley 3 · 0⤊ 0⤋
On property received as a gift, you have to pay capital gains tax on the difference between the selling price and the cost of the property. If your parents paid $10,000 for the property, you have a gain of $2,000. If this is a residence and you occupied it for at least two of the last five years, you do not have to pay any tax as there is a $500,000 exemption on sale of a personal residence. Given the amount involved, this is probably vacant land.
2007-12-14 10:23:18 · answer #3 · answered by Anonymous · 4⤊ 0⤋
He's already sold the property and taken the money, it's impossible to do a 1031 exchange after the fact (which would have deferred the tax not gotten rid of it anyway) .
2007-12-14 16:35:24 · answer #4 · answered by Anonymous · 1⤊ 0⤋
Yes, but probably not on the full amount you sold it for. See if they can tell you what their basis was - start with what they bought it for. Since you got it as a gift, your basis is whatever theirs was. You don't pay tax on that amount. So if they paid $7000 for it, for example, you'd only owe tax on $5000.
2007-12-14 19:02:25 · answer #5 · answered by Judy 7 · 0⤊ 0⤋
You will receive a 1099 for the sale of real estate from the closer/escrow. They will report this income to the federal government.
2007-12-14 10:33:56 · answer #6 · answered by William H 5 · 0⤊ 1⤋
Do a 1031
2007-12-14 10:18:50 · answer #7 · answered by sdotcarter0844 2 · 2⤊ 2⤋
Yep unless you occupied it as a primary residence and from the sounds of it the property is vacant land so Yep.
2007-12-14 10:19:44 · answer #8 · answered by Bdiddy 1 · 0⤊ 1⤋
Did you report it as gift income in 2001?
2007-12-14 10:22:34 · answer #9 · answered by JP 2 · 0⤊ 4⤋