gift of equity - Posted by cindy

Posted by William Bronchick on February 18, 2002 at 08:42:56:

A gift of more than $11,000 per year triggers gift tax reporting for your friend. If he is married and the spouse owns part of the property, the gift can be $22k/year. Beyond the annual exemption, his/her unified credit (total lifetime transfers exempt from tax) will be reduced. Right now, the credit is $1M and going up, so it may not be an issue for her in terms of taxes, just reporting.

gift of equity - Posted by cindy

Posted by cindy on February 16, 2002 at 06:18:21:

I am buying a condo from a friend who wants to give me a gift of equity…I am buying the condo for 170,000 and it has been appraised at 215,000. Will my friend have to pay taxes on this gift of equity or will I have to pay any taxes?

Re: gift of equity - Posted by JHyre in Ohio

Posted by JHyre in Ohio on February 19, 2002 at 06:51:40:

I would just buy the house for $170,000 with no gift tax reporting…I might have a differnt answer if a family member were selling to you. In my view, it’s just like buying a house for less than market value- you got a bargain because the seller was willing to sell cheap, as opposed to a gift.

John Hyre