Tax implications (adding child to investment property title-paid off)

**houseflipper** · 01-04-2012, 11:37 AM

Hi,
My parents helped me out and bought a log cabin (paid in cash) for me to live in and renovate. I have a good bit of flipping experience, just have never had the money to do myself. So, I think our first mistake was not putting me on the title to begin with (Ive been living here a year now, 1 more year and I would not have owed taxes on it once sold? If I am correct...IF I had been on the title?) So, IF we added me to the title now....what are the tax implications of that? Is there anyway to have that last year count towards the 2 yrs needed to live somewhere for no capital gains tax etc? And again, it's paid for....never was a mortgage on it....

Lastly, would I then be able to take out a loan against the property as collateral for future investments? or is there a timeframe that I'd need to be on the title etc?

Any help or input is much appreciated.....I realize a real estate tax attorney would be the best place to get answers, which I will do at some point, but came across this site and thought someone may know.
Thanks...
Scott

**Greg** · 01-05-2012, 05:55 AM

If your parents put you on the title it would be considered a gift and might trigger tax consequences for either you or your parents. Get professional advice.

**Leonard Vice** · 04-24-2012, 07:23 AM

Originally Posted by houseflipper

Hi,
My parents helped me out and bought a log cabin (paid in cash) for me to live in and renovate. I have a good bit of flipping experience, just have never had the money to do myself. So, I think our first mistake was not putting me on the title to begin with (Ive been living here a year now, 1 more year and I would not have owed taxes on it once sold? If I am correct...IF I had been on the title?) So, IF we added me to the title now....what are the tax implications of that? Is there anyway to have that last year count towards the 2 yrs needed to live somewhere for no capital gains tax etc? And again, it's paid for....never was a mortgage on it....

Lastly, would I then be able to take out a loan against the property as collateral for future investments? or is there a timeframe that I'd need to be on the title etc?

Any help or input is much appreciated.....I realize a real estate tax attorney would be the best place to get answers, which I will do at some point, but came across this site and thought someone may know.
Thanks...
Scott

Better ask from a real estate lawyer now so that you could get a professional advice or a licensed realtor in your area. You or your parents may face tax consequences when both of you are not able to fully settle what you need to when it comes to such.