I own my house with a very little balance left on my mortgage. I want to sell my house in a very legal way to my son. Can I continue to stay in the house as a tenant by paying reasonable rent and he gets all the benefits from that property as an investment property - getting deduction for all the repairs and depreciation etc? Would IRS disallow his deductions?

Thanks in advance,
HO

It is my understanding that you can legally sell your house to ANYONE, but you should make a WRITTEN contract of the afterthoughts.""continue to stay in the house as a tenant, paying reasonable rent [put on paper the amount with NO TIME LIMITS in living in house ], he gets all the benefits as an investment property - getting deduction for all the repairs and depreciation "". The IRS should not disallow his deductions. If everything is kept legal.

You can sell you house as long as it is sold for the correct price, you can't "sell" it for 10 dollars, that would be considered a gift and treated as such.

And you can rent it, of course you also will have to pay fair rent, which means he may also show income from the rental