(Closed) Buying a house from mom– need some advice please!

posted 8 years ago in Home
Post # 3
Hostess
18644 posts
Honey Beekeeper
  • Wedding: June 2009

She may have to pay some capital gains on the sale because she has not lived in the home.  Recently, the tax law was changed so that time after 2008 is not counted as exempt if you aren’t living in the home.  I would check with an accountant to find out the exact calculations (I’m a tax accountant but I have never done this).

EDIT: Here is some info on the changes: http://www.realestatewebmasters.com/blogs/mikey/6481/show/

Any time after January 1, 2009 that your parents rented out the home will be considered “Non Qualified Use” and if they make a gain on the sale of the property, that percentage will be taxable.  It is taxed at the capital gains rates, which are lower than normal tax rates.

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