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My mother-in-law has some property that was her home several decades ago.


She has moved but kept the property. It's value is around $65,000. She has no other assets. Her monthly social security and VA Pension is around $2000. She is needing to sell the property for her care. She is 91.


Are their tax implications with her selling the property?


Thanks!

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Possibly yes. This is a question for a local tax professional, not a global anonymous forum of not-accountants. Your most accurate answer will come from a local professional.
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Reply to Geaton777
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I would ask your accountant.

My dad sold a piece of property when he was 74 and there was no tax implications because we financed (carried) the sale, he got 20% down and payments over the next few years, so you do have options that a good accountant can help you with. This worked great for my dad because it gave him extra monthly income to help with care and quality of life, instead of lots of cash to blow.

If you do this right, mom should be able to qualify for assistance from Medicaid, if needed.
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Reply to Isthisrealyreal
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Because it appears that your mother in law does not meet the requirements for having lived in the home recently, she does not qualify for the capital gains exclusion for the sale of a home. To figure out her gain, you'd have to find out how much the home cost when she bought or acquired it, plus any improvements made after that. This would be the cost basis of the home. When it's sold, you subtract from the sale price any costs involved in the sale and then figure out the gain. For example, let's say house cost $30,000 + 10,000 in improvements = $40,000 basis. Sold for $65,000 - 2,000 closing costs = $63,000. $63,000 - $40,000 basis = $23,000 capital gain that would need to be shown when her taxes are filed. Because mom's income is so low, and the value of the property is also low, the capital gain is not apt to be significant enough for her to owe any taxes.

I'm an AARP tax aide volunteer so am familiar with tax implications of home sale
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Reply to newbiewife
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