Capital Gains

[TreyRo]

Have a quick capital gains question that I've researched a bit but haven't found a definitive answer. I know this is a bow hunting forum but we have some smart people roaming around here and plenty in the real-estate realm.

We have a lot that we were gifted a while back in a neighborhood. We had planned to build on it but decided otherwise and want to sell. Since it was a gift and we have had it for less than 2 years will we still pay full capital gains %%%.

[MikeyG]

First, you have to know what the donors basis is. When they gifted the property to you, that carry’s over to you.
So, if they paid 100k and you sell for 120k, you owe cap gains on the 20k.
Since you have owned the property for longer than 12 months, it’s long term cap gains. The actual rate will depend on your total income, but will either be 0, 15% or 20%.
Check with your CPA or consult with one who can look at your total picture.


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[easeup]

this will cover you so you can decide the next step

[MikeyG]

First, you have to know what the donors basis is. When they gifted the property to you, that carry’s over to you plus any adjustments for gift taxes paid.
So, if they paid 100k and you sell for 120k, you owe cap gains on the 20k.
Since you have owned the property for longer than 12 months, it’s long term cap gains. The actual rate will depend on your total income, but will either be 0, 15% or 20%.
Check with your CPA or consult with one who can look at your total picture.


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[Agdog]

I’ll be the first to ask….where’s the lot and how much you asking? [emoji23]

[TreyRo]

I’ll be the first to ask….where’s the lot and how much you asking? [emoji23]

1 Acre with Water Meter in Place (Big deal right now around here.) in the Reserve on SugarTree in Lipan, TX. (Golf Course Community- Brock Schools)

Going to list FSBO for 100k. TBH brother could get a better deal.

[TreyRo]

First, you have to know what the donors basis is. When they gifted the property to you, that carry’s over to you.
So, if they paid 100k and you sell for 120k, you owe cap gains on the 20k.
Since you have owned the property for longer than 12 months, it’s long term cap gains. The actual rate will depend on your total income, but will either be 0, 15% or 20%.
Check with your CPA or consult with one who can look at your total picture.


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Thank you that helps. I finally gave in and called a CPA buddy. I figured I could just research and figure it out myself but there are some gray areas since it was gifted and the market price has been on a steep incline.

[LAW]

Ask CPA

[TreyRo]

Ask CPA

Thank you that clears it up.

[Randallc]

I live in Sugartree, having an existing water meter is a big deal. Good luck.

[John Paul]

If it’s not your primary residence only way to avoid CG would be a 1031 exchange.

[gingib]

First, you have to know what the donors basis is. When they gifted the property to you, that carry’s over to you.
So, if they paid 100k and you sell for 120k, you owe cap gains on the 20k.
Since you have owned the property for longer than 12 months, it’s long term cap gains. The actual rate will depend on your total income, but will either be 0, 15% or 20%.
Check with your CPA or consult with one who can look at your total picture.


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I think this is correct

[Landrover]

If it’s not your primary residence only way to avoid CG would be a 1031 exchange.

Yep, 1031 or gift it to a 501c3 and have them sell it on your behalf......[emoji6]

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[TreyRo]

I live in Sugartree, having an existing water meter is a big deal. Good luck.

Thank you.. Posted it for sale today in a few places and getting blown up about it. Houses going up fast in the last few years.

[7sdad]

First, you have to know what the donors basis is. When they gifted the property to you, that carry’s over to you.
So, if they paid 100k and you sell for 120k, you owe cap gains on the 20k.
Since you have owned the property for longer than 12 months, it’s long term cap gains. The actual rate will depend on your total income, but will either be 0, 15% or 20%.
Check with your CPA or consult with one who can look at your total picture.

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We are doing this now and you pay cap gains on what the property has gone up from the time you got it and the time you sell it.