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Author: krisitef Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75383  
Subject: Using Mom's money Date: 6/11/2003 12:13 PM
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My husband and I have an opportunity to purchase a restaurant in the tourist town we live in. This restaurant has been established for 15+ years and is quite profitable. My husband has worked there for the past ten years, lately as a floor manager. He has a good feel for the business and a good rapport with the current owners. Here is the kicker. The owners owe $310,000 on an SBA loan for the building. They need this loan paid off before they can sell the restaurant and will owner finance the rest of the loan. The building would serve as collateral for the loan, but we have little cash in the bank, not close to 10%or 20% of the amount we would need. My husbands mother is 73, owns her house outright and has several hundred thousand dollars in IRA's, stocks, bonds, etc. What would be the tax ramifications (or other ramifications)if she cashed out enough to buy the building? She could then hold title for the building and rent it back to us. Any thought would be appreciated.
Thanks
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