If her total estate is less than 1.5 Million (or 3.0 Million) now, (I
think those are the current amounts), it doesn't matter how she does
it, her estate wont be paying gift/estate taxes anyway.

If she IS likely to have estate taxes then:
You might want your mother to sell you the house, you get a mortgage
and then she gift the money each year to you to make the payments. She
can give $11,000 to you and $11,000 to your spouse each year without
impacting gift taxes. If she does it near the end of the year she
could give 22k Dec 31 and 22k the next day, Jan 1 of the next year.
And of course the price of the house is negotiable.
You will also get the interest payment tax writeoffs. If you don't
qualify for the loan, maybe she could co-sign.

As you can see, most of the issues are your mother's not yours, though
if you do inherit after her death, the gifts in excess will count
against her non-taxable estate, reducing the amount that can pass
estate tax free, so I guess you (and her other heirs) might have some
issues.

As for costs if you do buy it from her, you will need to fill out a
purchase contract, apply for a loan, and pay the title company for the
transfer and title insurance. All this can be done without a real
estate agent or a lawyer, just contact a mortgage lender . They will
lead you through it. Though these things do vary a bit from state to
state.

firedreamer83[at]aol.com (Cathy) wrote in message news:<cd0eb9c6.0402101236.6f568d68[at]posting.google.com> ...
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I recently had a similar thread in another group:

http://groups.google.com/groups?hl=e...3DN%26tab%3Dwg

Please post if you decide what to do.


firedreamer83[at]aol.com (Cathy) wrote in message news:<cd0eb9c6.0402101236.6f568d68[at]posting.google.com> ...
- quote -

firedreamer83[at]aol.com (Cathy) wrote in message news:<cd0eb9c6.0402101236.6f568d68[at]posting.google.com> ...
- quote -


Cathy,

First off, congratulations on the start of a family and the start of a
new life in a new/old house.

There are a few details that would be needed to give a good answer to
your question. Are you married and do you have kids? Is your mom
married (since you stated the house as hers, I thought not). The
gifting rules are pretty straight forward: 11K per year from one
individual to another. So, if your mom is married, she could give 22k
per year to you - 11k from her, 11k from her husband. She can give
the 11k to her husband, and he can give to you, if they do not have
joint assets. If you are married, then double it. If you have kids,
then add 11k per kid per giftee. So, as an example, if you are
married and have one kid (3 receivers) and she is married (2
gifters), then they can gift you 66k per year.

Another Q to answer: Your mom's net worth. This is a bit tricky,
since the amounts will change over time. Your mom could pass $1.5
million tax free this year. Above that, count on estate taxes of 50%.
Gifts up to $1M are allowed while living without tax. Your mom will
not pay a tax to give you the house now, but she WILL eat into her
lifetime exemption....generally, people try to reserve that gifting
allowance to save on estate taxes. (eg, figure out a way to work it
into the annual gift exclusion).

Back to the house. One of the ways that people do this is to do a
sale, with a signed note. So, you agree to buy the house for $350k,
at 6% interest, that would be $25k per year. She gifts you back $11k
per year. You end up paying her $14k per year. (or whatever the
amortization schedule for the "loan" shows). It would work best if
there were either two of her (eg, a husband) or 2 of you (eg a husband
or kid). That way, she could gift you $22k per year. The only
downside to this is that she needs to claim your payments as interest
received, eg, income and will need to pay taxes on that. Or, she can
just give it to you, no taxes paid at the moment, just eats into her
exemption at death. If she has significant assets, I am not sure if
that is the best bet.

This is not specific advice, only information. It would be good if
you could go see a financial professional before you see the lawyer,
they would probably have another good idea.

Regards, Cynthia

Hi. Im about to start a family and my mother has recently expressed
the desire to give me one of her two houses- she has trouble keeping
up with both houses- they are on the other sides of the city- and has
left me in charge of this house for the past three years. The house
was estimated to have a total value between 350-400 thousand. Before I
go in and actually have a sit down with a lawyer I want to know what
our options are to get this property transfer done. I have heard that
it will be even more expensive to write this off as an outright gift
than to have me pay for the house and have my mom forward me the
proceeds. How much are we talking about here to get this done- we are
looking for the least expensive way. I would really appreciate any
comments/opinions anything really that you guys have to say about this
issue.
Thank you very much,
Cathy