Sunday, January 16, 2011

Will i have to pay taxes on real estate gain?

my spouse, my mother and i went in and got a loan together to purchase a new home. in order to use her land as collateral, the bank required that she give me 1/2 interest in the property. her other home that was on part of that land sold and i recieved a 1099 s on half the proceeds. do i have to pay taxes on that money?

Yes. You need to pay your portion of Capital Gain taxes on the GAIN (not the proceeds).

To be fair, your mom needs to reimburse you for this.

As well, when she gave you the half interest, she would have realized a LOSS on that transfer, which can be carried forward to the gain on the recent sale.

Finally, if the value of the land was greater than $12000, she would have had to file a Gift Tax Return for that year.

No comments: