Trading properties with nephew using Quitclaim deeds.

[Tracey Thornton]

​I own a 5 acre vacant lot in the country. And my nephew owns a 3BR house in a near by town. He and I want to trade the house for the property. I paid $52k for the property in 2007, and he paid $44 for the house in 2015. QUESTIONS ARE?

1. We are wondering if we can swap properties using quitclaum deeds that we fill out ourselves (no lawyers)?
2. Since I paid more for my property,  should I state my selling price as the $44k (same as what my nephew bought his for) , that way I can claim a capital loss on my taxes?

[Rick H.]

Quit claim deeds are typically used to release an interest rather than affirmatively grant or transfer marketable title.

Whether QC, Grant or Warrantee Deed is used, there are Federal, State and local Property tax implications.

People do this on the cheap all the time. Businesses like mine and attorneys get paid handsomely to fix the problems later. While there may not be a problem now, it may surface later.

Like the mechanic on the Fram Filter ads correctly said, 'Pay me now or pay me later.'