Sunday, August 21, 2011

Report home gift to IRS

Question: How can I deed my home to my two sons and how should they take ownership?

- Frank Daria


Answer: The transaction is considered a sale, so you can't just quit-claim the deed. You would file IRS Form 709 Gift Tax Return. You use the form to show the amount of the gift you wish to have applied to your lifetime exemption from gift taxes.

Neither you nor your sons should have any out-of-pocket taxes owed from the gift, but your lifetime exemption will be reduced by the value of the house that exceeds $26,000 ($13,000 per son).

The most flexible ownership would be tenants in common. Both your sons would independently own a 50 percent share of the property with full rights to sell their share without consent of the other.

by Dave Cherry The Arizona Republic Aug. 14, 2011 02:11 PM

Report home gift to IRS

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