Need LOUISIANA Help

[thomtax]

I have a client that just moved from Louisiana to Oklahoma.

In Louisiana they sold one acre of land. Land was originally inherited by mother. Mother gave it to TP in June and they sold it in September when getting ready for move. They keep telling me that it was an "ACT OF DONATION".

I have searched Louisiana DOR site. All I can find about act is for a vehicle. And it appears that this is just to prevent paying a sales tax when registering in new owner's name and has nothing to do with Income Tax. The sales price of the land was $10,000.

Is there something that I cannot find here and am missing? Or is this just handled in ordinary way?

ADVICE PLEASE!

Thanks,
LT

[Snaggletooth]

Typical Sale

Thom - I think the "ACT" is not a legislative action but rather the kindly act of a parent.
Several states in the south exempt sales tax if the transfer of title is made by a relative, and I don't think that affects the tax return at all.

The "gift" should not bear gift tax ramifications as it was under $12,000. I don't think LA would have a lower threshold than the Federal.

The basis of the property, however, is whatever the mother's original cost in the property, hence there is most likely capital gains, and this would be reportable as Louisiana income.

Not sure I understood your question, but I offer the above for what it's worth.

[Redneck]

Redneck fro LA

The basis of the property, however, is whatever the mother's original cost in the property, hence there is most likely capital gains, and this would be reportable as Louisiana income.

Snag';s correct unless they put a value on the act of donation.

[thomtax]

Thanks Snag & Redneck

That is what it looked like to me, that it was just a way to avoid certain transfer taxes at the state level. However, Redneck, I am curious, was this an act for transfering land in Louisiana. All I could find on the DOR site was making reference to transfering vehicles?

Snaggletooth - I understand your not completely understanding my question. I think that what I was looking for was some light into the overall situation.

Thanks again to both of you.

Lowell Thomas

[Redneck]

However, Redneck, I am curious, was this an act for transfering land in Louisiana.

Here in Louisiana and probably in other state also you can donate a piece of land to anyone.
But usually they put a value on it.