Selling a house to son

[Joseph Pothen]

Hi, I am a newbie,  my father wants to give me his house, it’s paid off.  What’s the best way to acquire it legally?  Someone once said he can sell it to me for a dollar to transfer the title.  Jumping on here for advice.

Thanks so much in advance.

joe

[Greg Scott]

Joe:

You will want to talk to an estate planning attorney about this.

Technically, your dad could sell it to you for a dollar.  But, what happens if you sell it later?  Depending on how expensive it is and whether you lived in it or treated it as a rental, you might pay huge capital gains tax.

An estate attorney may be able to set it up so you can live in it, but when your father dies you inherit the property.  Under today's tax code you would get it at a stepped up basis so your basis becomes the value when it was inherited.  You can avoid capital gains.