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Sent to Tax Experts September 9 2006 at 3:48 AM
   

This is a followup question regarding taxes on a gifted condominium. In 2003, my mother, through an attorney, gave me title to her condominium when she moved into an assisted living facility.    No market value "X" was determined at that time.    In 2005, I sold the condo for "Y" dollars when we determined my mother could not return to it due to health reasons.   During that 2 year period, we property paid taxes, monthly association fees, and a one-time association repair bill.    
Questions:
               1) Since the condo was never income-producing, is it correct to assume
                      there are no capitol gains taxes?
               2) If there are capitol gains, how would I determine the fair-market value "Y"
                     2003?

Customer (name blocked for privacy)
Status:  Closed   Value: $8
Answer
September 9 2006 at 4:34 AM (46 minutes and 19 seconds later)
         
ACCEPTEDCheck Mark

1. The sale WILL be subject to tax IF there was a GAIN on the sale. The only items that would be excludable from tax would be your personal residence. Based on the information in your previous post, this was not your residence.

2. The fair market value in 2003 has no bearing on your tax situation. You need to determine what your mother's basis was in the condo. That is, what did she pay for it originally? what was the cost of any improvements she made? were there any other transactions that affected her basis? Since you received the property as a gift, your initial basis will be the same as what hers was. You would probably be able to add the one-time assessment to that, depending on exactly what it was for.

jon@jonacpa.com



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