Welcome Guest. Register Now!  



Reply
 
LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 02-21-2011, 01:08 PM
Junior Member
 
Join Date: Feb 2011
Posts: 1
note receivable gift

My parents want to gift us a note they are carrying for a house they sold. The note is for $150,000 at 6% interest. There is a balloon payment in August. The house is now worth around $100,000. What is the best way for the transfer?



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #2 (permalink)  
Old 02-22-2011, 05:05 AM
Moderator
 
Join Date: Oct 2010
Posts: 5,236
“The note is for $150,000 at 6% interest. There is a balloon payment in August. The house is now worth around $100,000. What is the best way for the transfer?”---->First of all, your parents need to file a gift tax return, Form 709 since the amount of the gift for you exceeds the annual $13,000 tax-free gift limit. However, unless your parents made a huge gift exceeding $1.13,000 million( I assume that you are the only recipient of the gift) before or in 2010 alone, your parents are NOT subject to gift tax. So, I guess it's prudent to send in that Form 709 every time your parents make a transaction with a family member over $13,000 per year. You, as agift recipient, are not subject to gift tax UNLESS you agree to pay the gift tax as a condition of receiving the gift( if applicable). However, you need to report the interest income generated from the gift, note, as your gross income on your return, OK?



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
Ads
Reply


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

vB 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
Federal Gift Tax kfuchslin Estate Planning 0 02-16-2010 03:33 PM
Note Receivable Casco Income 0 01-29-2009 03:58 PM
Accrued interest on shareholder note to C-Corporation luke1290 C-Corporation 1 01-26-2009 10:35 AM
gift tax exclusion Rich Mort Estate Planning 0 01-04-2009 06:57 PM
Gift in family is exempt from tax? keshav Miscellaneous 2 12-27-2007 09:59 AM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 
Individual
 » Income
 » IRA/Sep
 » Medical
 
Corporations
 » Payroll
 
Forum for CPAs
 
Financial Planning