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C
Chris_Martin_C
March 24, 2022
Solved

Holding Period of Gifted Property

  • March 24, 2022
  • 1 reply
  • 0 views

My dad gifted my an empty parcel and I want to turn around and sell it. Since its a gift, do I receive his original cost basis back when he bought the land AND receive his HOLDING PERIOD as well? This is important because the holding period will dictate the taxes owed (Long Term or Short Term)? 

 

Example: Dad bought property in year 2010 for 100K and gifted it to me in year January, 2020. I sell it February 2020 for 200K. Would I owe 15% Long Term capital gains tax on the 100K (200k selling price - 100k dads original cost basis)? Tax liability of $15,000?  

Best answer by MAK70

On what Tax Form should I file all this? And can it be done through TurboTax?


You will enter as Investment Income under the Stocks, Cryptocurrency. Mutal Funds, Bonds, Other (1099-B)and it is reported to the IRS on Schedule D and Form 8949.  See How do I enter the sale of land - TurboTax @Chris_Martin_C

1 reply

M
MinhT1
March 24, 2022

For gifted property, the holding period includes the holding periods of both the donor and donee.

 

As to your cost basis, please read this IRS document.

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    C
    Chris_Martin_CAuthor
    March 24, 2022

    Thank you for the reply. So essentially, in Feb of 2020, when I sell the land, I would be subject to $15k of Long-Term Cap. Gains tax? 

    D
    DianeW777
    March 24, 2022

    Yes, that is correct because you have the same holding period as the donor.

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