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Gifting from Child to Parent

  • 1.  Gifting from Child to Parent

    Bronze Most Valuable Member
    Posted 10 days ago

    Each of three minor children own their own separate parcel of vacant land. Each parcel is valued at 80k. Each is held in a custodial account. Single mom wants to donate properties as taxes and other related costs are being incurred each year and there is no market for these properties. Kids have no income so charitable deduction will be of little value to them. My thought was to have them gift properties to Mom who has significant income and who could then make the donation and take a deduction.

    Thoughts?
    Thanks in advance.



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    Paul Herman
    HERMAN & COMPANY CPAs, PC
    White Plains NY
    (914) 400-0300
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  • 2.  RE: Gifting from Child to Parent

    Posted 9 days ago
    @mention

    Three things come to mind.  1.  If the property is not marketable so would it have any real value for a charitable contribution?

    2.  Since the property is potentially worth more than $5,000 in value, a certified appraisal by an IRS accredited appraiser is required and would cost some $$.

    3.  Would any charity be willing to take the property especially where there are costs involved?  What charity wants to take on a property with r/e taxes, etc. unless it might be adjacent to their own property or it would have a specific use or value to that charity?

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    Steven Miller CPA
    STEVEN E. MILLER, CPA, PC
    Dallas TX
    214.361.1131
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  • 3.  RE: Gifting from Child to Parent

    Posted 9 days ago
    Paul

    A recipient of a gift gets their tax basis at the LOWER of the cost basis or the fair market value at the time of the gift.  It was a little confusing when you said the parcels were "valued" at $ 80,000 but then said there was no market.  That's a drop contradictory unless you meant the
    $ 80,000 to mean tax cost. if it really was unsalable, it would be hard to justify a $ 240,000 deduction of the mom's gift i would think.

    Hopefully someone else much smarter than me will chime in also.

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    Allan Cohen CPA
    RAPHAEL GOLDBERG NIKPOUR COHEN & SULLIVAN CPAS, PLLC
    WOODBURY NY
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  • 4.  RE: Gifting from Child to Parent

    Platinum Most Valuable Member
    Posted 8 days ago
    Paul:

    I question whether a minor child has the legal capacity to give a gift.

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    Robert Brown
    ROBERT N. BROWN, CPA
    Jericho NY
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  • 5.  RE: Gifting from Child to Parent

    Posted 7 days ago
    Not an attorney, but don’t known if a custodian who is supposed to act in the best interest of the beneficiary can justify gifting property with $80,000 value.

    Bill

    > William Oricchio, CPA, MS
    > Tax & Accounting Services
    > Verplanck, NY