My brother and I were owners along with my mom (who retained life estate) in her home. Mom's health required she be moved to an assisted living facility and we were forced to put the house on the market and sell it as neither of us had the ability to maintain the home. Since my mother is still living - she received a portion of the sale proceeds based on her age. My question is - can we gift her any additional proceeds to avoid paying capital gains on the entire amount? I'm compiling paperwork to up the basis based on improvements made to the home - but still we will see a significant amount of the sale coming to us. Is gifting some back to her a good idea?
