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Financial Planning / Tax Strategies
|Subject: Re: Tax on sale of Grandma's home||Date: 1/9/2002 12:01 PM|
|Author: ptheland||Number: 56965 of 122095|
Can I maybe claim her as a Dependent and have the home treated as primary residence for a Dependent?
If you are providing over half of her support, and her income is less than the personal exemption amount for the year, she might qualify as your dependent. Unlike other people, parents (and grandparents) do not have to live with you to be a dependent. But they still have to meet the other dependency tests. The value of the housing you provide is part of her support.
However, the home will still not be your primary residence. You, not your dependents, need to live in the house to qualify for the exclusion. So I'm afraid the house is not your primary residence.
If I must treat this a capital gains, is the tax implication similar to capital gains on stock?
Yes. You've owned it for more than a year, so it will qualify for long-term capital gains at favorable tax rates.
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