I just bought 50% of an investment property, in Florida, with another friend. I used an LLC, to make the purchase. I am the manager and only member of the LLC. However, because of a conflict of interest with work, I am no longer allowed to keep my interest in the property. I am having trouble finding a buyer for my part so I am looking to transfer it to my mother through a quit claim deed. How can I reduce tax consequences. Would a gift or unified credit due? Is there an alternative? My interest is worth $100k. My mother is in her late 60s and I am in my 30s.
1 Answer from Attorneys
OK. What did the property cost you for the 50%? Lets make this really simple. You can gift $5.25 million before you have a gift or estate issue plus $14,000 per done per annum. Unless you're loaded, just make a gift of the membership interest in the LLC rather than using a deed. File a gift ax return next year. There will probably be no gift tax and no short or long term gain or loss. Mom takes on your cost basis for purposes of computing gain should the investment be sold. Unless mom has substantial assets, she, too, will not have a gift or estate tax issue.