Best way transfer property within family taxwise
Asked Mar 18, 2007, 11:11 PM
My mother currently owns property with a residence which she wishes to give to me (owned outright with no mortgage), however she would require me to give a much smaller amount for the property than its true value. Now in terms of taxes for the near and distant future (whenever I sell the house) what is best to do?
1. Just add me to the deed with quit claim or something similar so I can get a loan and pay her
2. Get a mortgage and buy property from her for the smaller amount, seems stupid since my tax basis would then be at that small amount and her capital loss would be non-deductible
3. Gift the house to me, but would the taxes be huge?
We have no issue having both of us on the deed, just need to get her some money to put away for retirement and I would need to tap the house's equity for that. What would be the most tax efficient way to proceed... thanks