Capital gain

Forum|Forum|1 year ago
February 5, 2025
1 reply
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I and My parents we bought house in 2010 priced 155k , and only my parents lived in there the whole time , I only live there until 2013 and my parents transferred house to my name only on 04/2024 with General warranty deed in exchange My parents will live in our new house bought 2024 (under my name and my husband name )without paying anything , I want to sell the house My parent transferred to me , so I just want how I am paying tax and limit capital gain in this case, we have contract between us Let my parents live in new house without paying anything .

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KrisD15

You first need to determine how much you owned when the house was purchased, half or one-third.

Next, was the transfer was a gift?

Your basis (cost) to use when the property is sold would be calculated on that amount. So if it was 155k and you owned half, your basis would start at 77,500. If you only owned one-third, it would be 51,667.

The portion they gifted you would be their adjusted basis, so the same as when purchased unless they made a major improvement.

So you would end up right where you started at, having a basis of 155,000.

If your parents sold the home, they could have claimed an exclusion for living there at least 2 of the last 5 years.

You won't be able to do that. You'll have to pay capital gains on anything over 155,000.

There also are many ways the deed could have transferred, which varies state to state. You might want to speak with a real estate attorney or accountant that is experienced with real estate in your state.

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HuanPAuthor

I am only co sign for my parent not owed anything Since they paid all the money , house paid off and Transferred to me through general warranty deed , not gift deed not sure how it consider gift or a transaction.

HuanPAuthor

Real estate attorney said if I paid it is a sale , if They give to me it is a gift . So let say they sold it to me so how capital gain in this case , time of transaction property was appraised 382k by County appraisal districts