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<blockquote data-quote="Josie" data-source="post: 599358" data-attributes="member: 1792"><p>I would be concerned that selling the house in 6 years for $1 would be considered a gift since the house is really worth $31,000. That would be over the $14,000 amount for that year. If he is married, you could give him and his spouse up to $14,000 each without paying the gift tax, so as long as you made the official sale when receiving the last $5,000 payment, you would be under that amount. The sale price would be $5,000 and the gift would be $13,000 to son and $13,000 to spouse.</p><p></p><p>If you wrote up your agreement saying he was making deposits that could be refunded if the deal didn't happen, then applied them to the sale at the time of transfer, that might work. The sale is taking place in a few years and doesn't need to be reported now or when it happens since it is under the amount. The payments made now are not really income because they have to be paid back if the deal falls through.</p><p></p><p>Maybe you could see if there are any attorneys that do a free consultation and you could run these ideas by them.</p></blockquote><p></p>
[QUOTE="Josie, post: 599358, member: 1792"] I would be concerned that selling the house in 6 years for $1 would be considered a gift since the house is really worth $31,000. That would be over the $14,000 amount for that year. If he is married, you could give him and his spouse up to $14,000 each without paying the gift tax, so as long as you made the official sale when receiving the last $5,000 payment, you would be under that amount. The sale price would be $5,000 and the gift would be $13,000 to son and $13,000 to spouse. If you wrote up your agreement saying he was making deposits that could be refunded if the deal didn't happen, then applied them to the sale at the time of transfer, that might work. The sale is taking place in a few years and doesn't need to be reported now or when it happens since it is under the amount. The payments made now are not really income because they have to be paid back if the deal falls through. Maybe you could see if there are any attorneys that do a free consultation and you could run these ideas by them. [/QUOTE]
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