Solved

[jliu12315]

Solved

[TomD8]

When you sell a house below its current market value, the difference between the market value and your selling price is called a gift of equity.  This website explains the concept: 

https://www.investopedia.com/terms/g/gift_of_equity.asp#:~:text=Key%20Takeaways-,A%20gift%20of%20equ... 

Gifts of equity are subject to federal gift tax regulations, which are explained here: 

https://www.irs.gov/businesses/small-businesses-self-employed/frequently-asked-questions-on-gift-tax... 

California does not have a state gift tax.

[jliu12315]

Thank you! 

Does this kind of sale tend to trigger auditing and/or have any potential risks?