My 2nd house is my parents' primary residence. If we sell it, can we ask a closing agent to make the check payable solely to my mother to avoid any capital gain tax?

[TomD8]

This web reference explains the differences between Joint Tenancy, Tenants in Common, and Tenancy by the Entirety.  With Joint Tenancy, the IRS regards each tenant as owning 50% of the property.  <a rel="nofollow" target="_blank" href="http://taxes.lovetoknow.com/tax-tips-joint-home-ownership">http://taxes.lovetoknow.com/tax-tips-join...>

[Hal_Al]

So, if the deed is held as  Tenants in Common; the poster can do what he wants; have the closing agent make the check payable to Mom. Mom takes a full home sale exclusion, and nobody pays capital gains tax.

If the property is titled as Joint tenants, poster reports half the capital gain on his return and Mom excludes  her half as the sale of her primary residence

[Opus 17]

The point is that for joint tenants, you each own half.  If all the proceeds go to your mom, that is treated as if you sold your half and then gifted her the money afterwards.  You still owe the gains tax because the gain is yours.

I also agree that if the home is held as joint tenants and you give your interest in the property to your mother, she will have to pay the gains tax on half the gain unless she owns both halves for 2 years.

You need to research how your deed is written.

[Critter]

Which comes back to my original statement ... seek professional help from an income tax pro or a RE attorney.

[preciousspark]

Dear Justin, did you finally get an answer to your original question?  Please update!

[preciousspark]

Did you end up quit claiming or gifting your portion to your mother before the sale?  Did you have to report the capital gains tax on your 50% of the gain even though you quit claimed/gifted all to mom?

[SweetieJean]

OP is not likely to be coming  back on this board after 2 years.

[Opus 17]

 A gift is only taxable if the giver has gifted more than $5.4 million during their lifetime. This is the amount of the lifetime gift and estate tax exclusion. And there is some talk about eliminating the estate tax altogether in the current tax reform plan.  Unless you have given more than the exclusion limit, the gift must be reported but no tax is actually owed. 

If you are the part owner of the property when it is sold, and the IRS figures out what you are doing, they will assume that you are a 50-50 owner and that you are responsible for the capital gains tax on 50% of the gain. Your mother can exclude tax on her 50% of the gain, but you cannot exclude tax on your gain.   Simply directing that the check be made out entirely to your mother might impede the ability of the IRS to detect what is going on, assuming that the closing agent goes along with it, but it does not make it legal.    And you may find that the closing agent will refuse to go along with it. 

 If you quit claim deed your share of the home to your mother before the sale, then your mother is entitled to a $250,000 exclusion, and if she files jointly with a spouse, they are entitled to a $500,000 exclusion even if his name is not on the title. 

You may want to discuss this with an attorney or tax advisor. But what it sounds like you are planning on doing is likely to be viewed by the IRS as fraud if they catch you.