Gift Rules

First of all this is a gift tax, not an income tax issue.

Gifting outright will use up some of your lifetime exclusion. However, gifting it over a few years by using only the max allowable exclusion amount each year might work. Another approach would be to sell it to the boys for a mortgage. Then you gift down the mortgage up to the max allowable exclusion each year. ___________________________________

-----> real address on hobokeni or hobokenx

Follow the link below. Their answer is short and concise. Pay close attention to the basis repercussions and the potnetial need for annual reappraisal. Hopefully, the basis adjustments won't come into play because the childrens' gain at sale will not be above the exclusion limits.

Who is married?

If none, you can give them each $12K worth of equity each year; in about 3 years, that's all of it. If you're married, you (and your spouse) can give each $24K per year, so they get it all by next year. (If they're married, the amount similarly increases.) Seth

You have a few choices.

Gift them partial ownership, at the rate of $12K/year per child. Gift the whole amount and file the paperwork for the amount in excess of $24K, and take the unified credit against it. (i.e. you are reducing the amount you can leave them when you pass on) Sell them the property for market value, but take back a note for the excess (the amount over the $12K per) and 'forgive' the $12K/ year. Gift them money in

JOE

Thank you all for this advise!

This is very useful information. I've started looking at the tax codes for more detail.

-nick