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rmul32
New Member

If my aunt sells me a property for $60,000 under appraisal value will she have to pay gift tax

 
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3 Replies

If my aunt sells me a property for $60,000 under appraisal value will she have to pay gift tax

Since your aunt is essentially selling you the property for $60,000 less than fair market value, she is giving you a gift to that extent ($60,000), which exceeds the annual gift tax exclusion of $18,000 (for 2024).

 

As a result, she will need to file a gift tax return.

 

See https://www.irs.gov/instructions/i709#en_US_2023_publink16784xd0e649

 

However, unless she exceeds her lifetime exclusion amount of $13.61 million (for 2024), she will not owe any gift tax.

 

See https://www.irs.gov/instructions/i709#en_US_2023_publink1000292380

If my aunt sells me a property for $60,000 under appraisal value will she have to pay gift tax

you should also get documentation from her as to her basis in the property.  At some point you may want to sell.

to determine if you have a taxable gain you'll need to know her basis. 

Hal_Al
Level 15

If my aunt sells me a property for $60,000 under appraisal value will she have to pay gift tax

"Gift Tax" is somewhat of a misnomer.  Even though a gift tax return may be required, very few people ever actually pay federal gift tax. The purpose of the gift tax return is usually only to document a reduction in the allowable estate tax exemption.
See https://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/The-Gift-Tax-Made-Simple/...  

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