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I have a friend who's aunt owns some land in North Carolina. The tax value of the land is approx 60k. The aunt has agreed to sell it to the nephew for 70k. There is no "cost basis" as the aunt inherited the land. We're brainstorming on how to legally minimize the taxes for the transaction. Any ideas on how to structure the deal?

Concerns for the aunt are capital gains taxes. The nephew is concerned about triggering the gift tax.

Anyone had any experience dealing with applying the Unified Credit to the Gift Tax (IRS website)?

The aunt trusts the nephew, so the payments-over-time option is also available. She just doesn't want to incur a hefty capital gains tax when the land is sold.

Any thoughts would be greatly appreciated.

Xposted to tax board.

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