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My mom and i bought a house in Canada with cash together but only she lives in the home

She is a Canadian resident and I am a US resident. We put cash together and bought a primary home for her. We decided that I only own 1% of the home on the title and she owns 99%. 

1) Do I need to report this purchase to IRS?

2) Do I need to report the inheritance to IRS if she passes away and leave the home to me?

3) Do I need to report the sell profit of the home if we decide to sell it?

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1 Best answer

Accepted Solutions
Vanessa A
Expert Alumni

My mom and i bought a house in Canada with cash together but only she lives in the home

No, you do not need to report the purchase to the IRS.

 

Probably not, there could be an estate tax when she passes away, however, the current threshold to have to pay taxes on an estate for the federal return $13,610,000.  However, states have different inheritance rules, so depending on your state, you may have to pay a state inheritance tax.

 

Yes, you would need to report the sale even though it is 1% ownership.  You would report 1% of the profit. 

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1 Reply
Vanessa A
Expert Alumni

My mom and i bought a house in Canada with cash together but only she lives in the home

No, you do not need to report the purchase to the IRS.

 

Probably not, there could be an estate tax when she passes away, however, the current threshold to have to pay taxes on an estate for the federal return $13,610,000.  However, states have different inheritance rules, so depending on your state, you may have to pay a state inheritance tax.

 

Yes, you would need to report the sale even though it is 1% ownership.  You would report 1% of the profit. 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
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