When your parents quitclaim property to you and you sell your interest to your sibling, is that taxable?
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Yes, probably. But it depends on the details.
The general rule is that you have a taxable capital gain if the $11,500 you received was more than your parent’s cost basis in the property. The cost basis in a gift is the giver’s cost basis. That is, your cost basis is what your parents paid for it, plus any adjustments.
Here's an example: your parents paid $20,000 for the property many years ago. Now they jointly deed it to you and your sibling. You each have a $10,000 cost basis in your half. If you sell your half to your brother for $11,500; you have a $1,500 capital gain to report on your tax return.
If you sell to your brother, at a loss, you may not deduct the loss. Also, note that it does not matter, for income tax purpose, what the property is currently worth
Yes, probably. But it depends on the details.
The general rule is that you have a taxable capital gain if the $11,500 you received was more than your parent’s cost basis in the property. The cost basis in a gift is the giver’s cost basis. That is, your cost basis is what your parents paid for it, plus any adjustments.
Here's an example: your parents paid $20,000 for the property many years ago. Now they jointly deed it to you and your sibling. You each have a $10,000 cost basis in your half. If you sell your half to your brother for $11,500; you have a $1,500 capital gain to report on your tax return.
If you sell to your brother, at a loss, you may not deduct the loss. Also, note that it does not matter, for income tax purpose, what the property is currently worth
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