I live in MA, and I am considering selling a real estate (condo) as a gift to family member ( my brother) for less than fair market value now. Is there a tax penalty ?

Forum|Forum|7 years ago
June 1, 2019
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I live in Massachusetts, and I am considering selling a real estate (condo) as a gift to family member ( my brother) for less than fair market value now. Current market value is about $250,000 and I would sell it to him as gift for $ 150,000. Is there going to be a tax implication or penalty for me as person who is selling this to him on either state or federal taxes? This property was rental, I collected and reported rental income over the last 4 years

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TomD8

Alumni - Champ

What you're describing is called a "gift of equity." This web reference gives a good summary of the tax implications: https://www.investopedia.com/terms/g/gift_of_equity.asp

**Answers are correct to the best of my ability but do not constitute tax or legal advice.