Announcement

Collapse
No announcement yet.

Sale of gifted property

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Sale of gifted property

    Can you help me understand the rules for figuring gain or loss on property that was received as a gift?

    The chart says if the property was sold at a gain, use the donor's basis. But if I use the donor's basis, it would be a loss.

    The chart says if the property was sold at a loss, use the lesser of donor's basis or FMV at time of gift. But if I use the lessor of the two, which would be the FMV, there would be a gain.

    HELP!!!

    Donor bought property for $60,000. Property values went down and couldn't sell the property. From what I understand, he was applying for some kind of assistance which he didn't qualify for because of owning the property so he gave it to my client. The FMV at the time he gave it to them was about $2000.

    They sold the property for $2500 in 2005. So what basis do I use?

    Thanks
    Linda F

    #2
    Gift property

    Linda,
    If the sales price is between $2,000 and $60,000, you have neither gain nor loss.
    See Pub. 17 page 103 under Property Received as a Gift first Example.

    Comment


      #3
      Thanks

      Thanks alot Gene. I was stumped on that one. Hadn't thought to look in Pub 17.

      Linda F

      Comment

      Working...
      X