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My mother is considering investing into a new home with myself and brother. My brother will be the only person living in the new home. Myself and my mother live out of state from where the home is located.

My mother is wondering, what are the IRS tax implications of being a co-owner ?

Would this not be handled like a large stock purchase - only when the investment is sold and an income or loss is realized, then there would be IRS tax requirements ?

She is not interested in witting off the property taxes on her tax return. Basically, she just wants to be co-owner without any of the hassles (insurance, etc.. ). As of now, she thinks that this will involve considerable involvement on her part dealing with the IRS etc..


Not that you asked, but please engage the services of an attorney to draw up a formal agreement on this. You need to address such things as who does what, who pays what, how proceeds of sale are handled, what happens if someone wants out, etc. Spending time now discussing and settling such things while everyone's talking will go a long way to preserving family peace and assets when the day comes that there's a disagreement or someone dies.

As for taxes, you can pretty much set things up as you want to. How you set things up will determine the effect on taxes. If your mother just wants to be an investor, things can be set up so there's no effect on her taxes until the property is sold.

Phil
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