The gifts add up to more than the cost, but not more than the FMV at the time of sale (stated as $600,000). My tax calculation relies on their statement that the son owns 2/3.
Nope and Nope.
They said that their son owns their 2/3 as of 2022...."our 2/3rds ownership has since past to our son (by year 2022)".....as they had given away an incremental part of their ownership over the years of JT starting in 2010. Based on that the son is the sole owner now.
The parents didn't say how much they gifted each year but if was the maximum exclusion each year starting in 2010 that would add up to more than the FMV at the time of the sale. 2010-2017 alone could be a total of $218k if you do the math. Then add another $120k for 2018-2021 plus $32k for 2022. Don't know about you but I'm coming up with $390k by the end of 2022 which is very close to $400k.
But $400k or $600k wouldn't be what they are gifting because they had already made incremental gifts since they bought the condo in 2010. In the beginning years, each maximum gift would have conveyed more as a percentage of ownership because the gifts would have been based on the FMV at the time of the gifts.....not the current FMV of $600k.
