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Avoiding Capital Gain Taxes
I am looking at buying 25% of my mother's property (she is still alive and living in this home). The reason for this purchase is to offset one of my siblings debt and to buy him out of his 25% inheritance of this property upon her death. If I have my mother change ownership of her home to 75% her and 25% me - will I avoid paying capital gain taxes when I inherit the remaining 75% of the home upon her death - as I will already have been a partial owner?
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I don't understand what you're trying to accomplish here. There are no capital gains when a person dies and property is passed to the heirs. The cost basis of the property gets "stepped up" to the fair market value as of the date of death of the decedant. If you buy 1/4 of the property now, your mother would be responsible for paying capital gains tax now on the portion she sells to you (unless the sale qualifies for an exemption). |
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