Posted on: 12th Jun, 2008 01:55 pm
my mother wants to quit claim deed her house to me. no mortgage on the property. can this be done or will it be considered a gift and therefore a gift tax would be applied?
Hi Guest.
Your mother can quitclaim the property to you but it will be considered as gift. So your mother may need to pay gift tax for it. BTW she may get approved for the gift tax exemption and the annual gift tax exemption limit per person is $12000.
Best of luck,
Larry
Your mother can quitclaim the property to you but it will be considered as gift. So your mother may need to pay gift tax for it. BTW she may get approved for the gift tax exemption and the annual gift tax exemption limit per person is $12000.
Best of luck,
Larry
Hello.
Agree with Larry that if your mother quitclaims the property to you then it will be considered as a gift and you may need to pay gift tax. Larry has informed you about the annual exemption limit but I would I like to add that the lifetime gift exemption limit of $ 1 million. So if it doesn't cross the limit then you will need not to pay any tax on it.
Hope this helps.
Feel free to ask if you have any more queries.
Agree with Larry that if your mother quitclaims the property to you then it will be considered as a gift and you may need to pay gift tax. Larry has informed you about the annual exemption limit but I would I like to add that the lifetime gift exemption limit of $ 1 million. So if it doesn't cross the limit then you will need not to pay any tax on it.
Hope this helps.
Feel free to ask if you have any more queries.
Thank you both. Since I asked that question, I have been reading lots of tax information. Please let me know if I understand this correctly. My mom QCD the houses to me (approx 100,000.00), for the annual exemption we deduct 12,000.00 leaving 88,000.00. We find out what the gift tax is on 88,000.00........then that is what she recports to the IRS. BUT since it's not more that the lifetime exemption limit, she will NOT have to pay a gift tax, just report the amount to the IRS. Am I understanding this correct??? Thanks for your help!!
I am no expert but I think the lifetime exemption does not mean she can gift more than the annual amount without penalty. I would seek out a CPA on this as they will have a solid answer and may be able to structure something without so much bite when tax season rolls around
Brian
Brian
I think this quit claim is very common and without mortgage on it. so, i don't think your mother should pay gift tax for it.