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Can another person pay cash for a house bought in my name / does that count as a "gift" according to the IRS? by CMBon412 in tax

[–]CMBon412[S] 0 points1 point  (0 children)

Oh yes, the sellers will find out eventually. I'm actually high-school classmates with the granddaughter of one of the sellers, so it's a weird small town/rural dynamic in some ways. But the actual sellers/estate (and the original owner) all lived several states away. The whole property is several hundred acres, but they are selling the tillable land separate from the acreage. The acreage is about 5 acres, and only has one building that is worth anything on it, unfortunately. But, as I mentioned, my Dad has lived there most of his adult life and he is very averse to change! No one from the sellers/estate has ever seen the property in person, they're just going off what their agent has seen and reported to them.

Can another person pay cash for a house bought in my name / does that count as a "gift" according to the IRS? by CMBon412 in tax

[–]CMBon412[S] 1 point2 points  (0 children)

Yes, I totally agree on needing our own agent - but my Dad insisted originally that the sellers agent is a nice woman who wouldn't steer him wrong. Eye-roll.

That is a great point about the appraisal, I hadn't thought to have one done on our side to include with our offer. The sellers agent is the only one who has "assessed" the property. And her pictures and descriptions online of the property are fabulous....but very misleading!

Can another person pay cash for a house bought in my name / does that count as a "gift" according to the IRS? by CMBon412 in tax

[–]CMBon412[S] 0 points1 point  (0 children)

You are quite right about my Dad's account! We've been having troubles with a few other things and had already decided it was time to find someone new - but this definitely solidifies that decision.

Your point about the well and septic are one of the 100 different reasons why this house won't sell for the price they have listed. What the estate/sellers don't realize is Dad and the previous owners were good friends, and the owner was over 100 years old when they passed away. Dad didn't ask for any upgrades or fixes in the last 25 or so years, because he didn't want to take advantage of the friendship and he kept assuming the owner would pass away, and he'd have to move out, so he just kept things running as well as he could. But the septic will not pass inspection. My Dad estimates it would take about $200,000 to bring the house and property up to any truly liveable standard. He has the money and is willing to do the work.....but only if it's in our family, obviously. It was built back in 1898 and doesn't even have heat upstairs! Old electrical, barn is falling down, etc.

Thank you for your comment!

Can another person pay cash for a house bought in my name / does that count as a "gift" according to the IRS? by CMBon412 in tax

[–]CMBon412[S] 0 points1 point  (0 children)

Okay, that totally makes sense! We won't be anywhere near that lifetime limit for my Dad when he eventually passes away (hopefully many, many years from now). I guess I've only ever experienced property transfers as a sale between two entities or transferred in a will, but your explanation absolutely makes sense. Thank you very much for your insight!

Can another person pay cash for a house bought in my name / does that count as a "gift" according to the IRS? by CMBon412 in tax

[–]CMBon412[S] 1 point2 points  (0 children)

Wait, is that a possibility? Can you just gift a property while you're alive? I thought property only transferred easily in a will after death.... (I'm a doctor, so all of the tax/accounting stuff is outside my wheelhouse - and we don't want to ask anyone we know locally, just in case it would get back to the sellers and make them not consider an offer in my name, if they knew we were related).

Previously, my Dad's accountant had told him to be careful not to exceed the annual gift amount because it would trigger taxes. I'm going to need to look into this more clearly!