Will there be tax issues if I buy a cheap house with no mortgage and let my daughter live in the house I buy for free? She can pay the utilities ?

[XAM330]

I have no taxable income and do not owe or receive anything on my tax filing every year.

I have only pension and social security with no taxes taken out and when I file I do not owe or receive money. To clarify for the comment below in the event it may matter some how and is not just sarcasm.

[fanfare]

what will you buy the home with? a handfull of rolls of $20 gold pieces?

[SweetieJean]

I think @fanfare wants to be sure you do not have other sources of income (such as assets or investments) that would become taxable if you sell them to pay for the home.

[SweetieJean]

or an IRA or 401(k) plan.

[XAM330]

Liberty or  Saint Gaudens? That would be mush more than needed. I believe I will just write a check. Have you never used a savings or checking account. You must have a lot of gold coins and cash laying around. Thanks for your comment.

[XAM330]

SweetieJean...I will not be selling anything to buy the house not even the $20 dollar Gold pieces.

[VolvoGirl · Accepted solution]

No.  That is a second property.  You can deduct the property tax on it in addition to your own property tax.  You will pay tax on the profit when you sell it.

[SweetieJean]

"I have no taxable income and do not owe or receive anything on my tax filing every year."

[XAM330]

I have only pension and social security with no taxes taken out and when I file I do not owe or receive money. Is that what you are questioning with this comment ?

[SweetieJean]

Yes. So there will be no immediate tax effect, since you have no taxable income against which to deduct the property taxes  But, as indicated above, you will pay taxes on the profit when you sell the home.

[XAM330]

Thank you. I will have to pay taxes on the home to but she can not. Sell, I may not be around for that.

[Critter]

There is no rule preventing doing that and no tax ramifications either.

[XAM330]

Thank you Critter

[Anonymous]

your name will have to be on the title otherwise you have made a gift of the the house to your daughter and may have to file a gift tax return  (for 2018 if value over $15,000).   and if your name is on the title, check with your insurance agent to make sure you have proper coverage.     - someone gets injured on the property and there's a lawsuit, the owner is always included.