Posted on: 24th Jul, 2009 02:43 pm
Hi there,
My husband's mother quit claimed 50% of her house to him in 1997. We have since lived there the last 6 years and his mother has remarried and lived in another home for about 4 years. She wants no interest in our house and has offered to quit claim the other 50%. We will be putting the house on the market shortly. So, my question is: Will we only be given credit (capital gains exemption) for 50% of the house as we only 'owned' half while we were living here for 6 years? Or, since we have lived here for so long, will the timing of the quit claim not matter?
We are concerned that if his mother does not quit claim the other half of the house, she will have to pay capital gains tax on her portion of the proceeds.
Thank you!
Laur
My husband's mother quit claimed 50% of her house to him in 1997. We have since lived there the last 6 years and his mother has remarried and lived in another home for about 4 years. She wants no interest in our house and has offered to quit claim the other 50%. We will be putting the house on the market shortly. So, my question is: Will we only be given credit (capital gains exemption) for 50% of the house as we only 'owned' half while we were living here for 6 years? Or, since we have lived here for so long, will the timing of the quit claim not matter?
We are concerned that if his mother does not quit claim the other half of the house, she will have to pay capital gains tax on her portion of the proceeds.
Thank you!
Laur
Hi laurenjillwelch,
The capital gains tax will be calculated by subtracting the original purchase price of the property from the present sale price of the property. You will have to pay the capital gains tax based on the profit you make by selling off the property. If your mother-in-law is one of the owners of the property, she will be equally liable to pay the capital gains tax.
Thanks
The capital gains tax will be calculated by subtracting the original purchase price of the property from the present sale price of the property. You will have to pay the capital gains tax based on the profit you make by selling off the property. If your mother-in-law is one of the owners of the property, she will be equally liable to pay the capital gains tax.
Thanks
laurenjillwelch
Do you think that by selling the property now you will be incurring some profit???
If the answer to above question is yes then I think you have to pay for the capital gain tax and you will be liable for only 50 % tax whereas.....
If the answer for the question is 'No' then............
then there is no gain on capital with the real estate so even if you sell the property yo will be not toiled for the capital gain tax.
keep in touch.....
:arrow: :arrow: :arrow:
Do you think that by selling the property now you will be incurring some profit???
If the answer to above question is yes then I think you have to pay for the capital gain tax and you will be liable for only 50 % tax whereas.....
If the answer for the question is 'No' then............
then there is no gain on capital with the real estate so even if you sell the property yo will be not toiled for the capital gain tax.
keep in touch.....
:arrow: :arrow: :arrow: