[starjets]

Hi there,

My ageing Mum holds a green card and is living in Europe . She want to give me the title to a piece of land that she purchased in 1991 for $ 20,000. The land is now valued at around $ 250,000 .
I am her son and hold US citizenship . What are the tax implications . Will there be an immediate tax liability or will it be triggered when I sell the property .
Thank you.

[AtlantaTaxExpert]

Tax wise, it would be better if you wait until she passes and you INHERIT the property, at least from a U.S. perspective.

If she gives you the property, she must, as a green card holder, file a gift tax return. Applying the Unified Credit will keep her from PAYING any gift tax, but the gift tax return will still be required.

In receiving the gift, you also receive the original $20,000 basis. Hence, when you sell the property, you will pay long-term capital gains at probably 15% on $230,000.

However, If you inherit the property, the property's basis is "stepped up" to the Fair Market Value at the time of your mother's passing. The net result is you save over $34,000 in capital gains taxes.

Note that you must consider the tax situation in the country where the property is located.