Capital gains tax on gifted property

[tax102523]

Could a person be responsible for paying capital gains tax on a California house if they are gifted that house from their parents? Thank you!

[lramkumar]

Hello vgtax !

You don't pay taxes on the gifted property when you receive it.  When you sell  the gifted property,  you will pay capital gains on the gain both federally and in State.

Hope that clarifies your question!

Thank you 

[Anonymous_]

The child would not be liable for capital gains tax on a gift from a parent until such time as the child sold the house to an unrelated third party.