Hi everyone, I need some advice here. I am taking over and being gifted from my parents a $1.5M home from their Trust.
In an effort of fairness, I want to pay my two brothers a monthly amount ($1,250/ea), until they recoup their portion that they would have received ($500k/ea) had this property be executed upon the death of our parents.
We all want to avoid this counting as income tax for them both, and originally thought we classify this as gift payments, as it’s under the annual limit anyway.
Additionally, I’ll be the sole owner on the deed when it is transferred.
How do we structure this process to avoid my payments to them as taxable income and avoid any audits, etc.?
Posted by FatsDomino98
7 Comments
Hire a CPA. Look how much money you are getting. Get a pro rather than nameless well meaning but possibly totally misinformed souls on social media
Rocketplayer doesn’t know what he’s talking about. Your brothers deserve gifts. If you have a modicum of generosity in your soul you’ll just gift them money each year
This sounds like a bad tax plan.
First of all receiving a home as a gift, when you stand to inherit it means that you do not receive a step up in basis.
Then gifting $1M to your brothers, would also not increase your basis in the home.
This might leave you with a very large tax bill at the end.
There’s so many red flags here, please go see a professional before doing any of this. There are much more efficient ways to do this
Half a million dollars at $1250/m would take you over 30 years to pay them.
Get a lawyer
Terrible estate planning but you can gift 19k a person so there is no issue with giving them that amount.