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Updated about 4 years ago on . Most recent reply
My mother bought a home to resell. Does she pay taxes on sale?
My mother owns a property and wants me to help her sell it and get paid for it
Will she have to pay capital gains if she takes that money and re-invests it?
She plans on making 50k and purring that 50k into a NEW barn..
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#1 1031 Exchanges Contributor
- Qualified Intermediary for 1031 Exchanges
- St. Petersburg, FL
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#1 1031 Exchanges Contributor
- Qualified Intermediary for 1031 Exchanges
- St. Petersburg, FL
@Cameron Riley, There's a lot of question marks to be. answered. If it's her primary residence and she meets the requirements of sec 121 then gain is tax free up to $250K of profit ($500K if she is married).
If it is not her primary residence and she has held the property for productive investment use then it would qualify for a 1031 exchange and get to indefinitely defer all tax.
But if this is a property that she bought to resell as the title indicates then it wouldn't qualify for 1031 treatment.
- Dave Foster
