Capital gains and a gift from my mother Hopefully someone here can give me a bit of advice. I?ll try to make this as short as possible so bear with me while I attempt to explain the situation
My question: What options do I have or what process can I go through to reduce my tax liability when receiving a gift from my mother with the sale of property
Backstory: My mother at one point was dating a guy that found himself in a bind with some property he owned, IRS was going after his stuff for back taxes. My mother bailed him out and in return he transferred 2 pieces of land to her. Years and years later she decides she wants to sell them to help me with the purchase of a home on property I own (not the same property). However, after looking at the sell price, 50k in California, with all the fees associated with the sale including lawyer fees and capital gains she really isn?t getting much out of it and all in all it will not be enough to buy much of a home. At this point we are thinking she will net 25k out of the sale, if not less.
Another thing to note is that the buyer is planning on paying her in two separate transactions, one this year and one next year
I?ve done a bit of research on it and it seems there may be a way to avoid capital gains if she were to re-invest that money into another property but how does my new home fit into that or the fact that I own the property (I?ve got a mortgage on it).
I was originally planning on using the money to buy a modular home at around 60k with the money I am getting out of this sale as a down payment but ?? with that amount shrinking it will be harder and harder to get the financing needed
Can anyone give me any advice?
Thanks |