Posted on: 13th Oct, 2011 01:26 pm
If a family member pays off your first mortgage loan are you or the family member responsible any tax liability?
Hi MRob!
Welcome to forums!
I don't think there would be any kind of the tax liability for the family members if someone pays off the first mortgage in full.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
I don't think there would be any kind of the tax liability for the family members if someone pays off the first mortgage in full.
Feel free to ask if you've further queries.
Sussane
Hello MRob,
If tax is still remains payable while close of books of accounts then it is a liability to be paid to tax authorities that's why shown under liability side of balance sheet as current liability.
:idea:
If tax is still remains payable while close of books of accounts then it is a liability to be paid to tax authorities that's why shown under liability side of balance sheet as current liability.
:idea:
Yes. Gifts above a certain amount of money are taxable. Because of that, my Grandfather gave my parents $9,000.00 per year, below the taxable limit for him, so they could pay off their mortgage early.
This is a mortgage web site and you are asking an accounting question.
I guess it does not hurt to ask the question, but, we are not permitted to give accounting advice, other than to suggest you check with an accountant.
That being said and not being an accountant, what Raymond notes above is probably the correct way to go about things, although, if you do not report yourselves, who would ever know.
Anyone is allowed to give anyone else a gift with no tax implications up to, I think $13,000 per year. So, a mother and father could each gift $13,000 to a son and each another $13,000 to his wife. That would be a gift per year of $52,000.
If the mortgage balance paid off were larger than that, I have "heard" of someone signing for a loan from their parents for the amount of the pay offs, no payments were made, and the parents forgave $13,000 or $26,000 or $39,000 or $52,000 per year until the loan was down to a zero balance.
If you are concerned about any tax implications, check with an accountant or hope an accountant is answering questions on this mortgage web site.
I guess it does not hurt to ask the question, but, we are not permitted to give accounting advice, other than to suggest you check with an accountant.
That being said and not being an accountant, what Raymond notes above is probably the correct way to go about things, although, if you do not report yourselves, who would ever know.
Anyone is allowed to give anyone else a gift with no tax implications up to, I think $13,000 per year. So, a mother and father could each gift $13,000 to a son and each another $13,000 to his wife. That would be a gift per year of $52,000.
If the mortgage balance paid off were larger than that, I have "heard" of someone signing for a loan from their parents for the amount of the pay offs, no payments were made, and the parents forgave $13,000 or $26,000 or $39,000 or $52,000 per year until the loan was down to a zero balance.
If you are concerned about any tax implications, check with an accountant or hope an accountant is answering questions on this mortgage web site.
