The tax liens will be paid off first and then the mortgage. I would try to short the mortgage if you can. Otherwise you will be responsible for the balance.
As in a short sale? What does that do to my future ability to get a mortgage or? I am in the process of negotiations w/ the IRS filed for equitable relief under the innocent spouse rules. I am a layman and have no idea of where to go from here, looking for help any you can give me is very much appreciated. Thank you.
Yes, you & he can do a 1031 with your land. You must hold the property for 2 years, otherwise the transaction becomes taxable as if you never did the 1031.
As far as I am aware, there is no prohibition against using farm land in a 1031 exchange. Please tell us your source for this if it is in fact prohibited.
we belive that the house is worth 95,000. Yes the wife has lived in the house off and on over the last three years. She is a travel nurse and traveled a lot. She has lived in Delaware the last 18 months.
If your wife does not qualify for the capital gains exclusion on the sale of a primary residence because she does not meet the 24 of 60 month ownership and occupancy requirements, then the sale of the house is a taxable event.
If the sale price is $95K, taxable profit will be computed on the net sale proceeds. If you want to give your daughter $30K from the sale proceeds, you might be able to reduce your taxes by making a $30K seller concession for repairs and renovation in the purchase contract. Now, at settlement, the $30K is deducted from your net sale proceeds and your tax burden is reduced.
As an alternative, do the remodel yourself prior to the sale then adjust your cost basis accordingly. Now your taxable profit on the sale is reduced by the amount of your improvements.
Can you what? Sell the property?
The tax liens will be paid off first and then the mortgage. I would try to short the mortgage if you can. Otherwise you will be responsible for the balance.
As in a short sale? What does that do to my future ability to get a mortgage or? I am in the process of negotiations w/ the IRS filed for equitable relief under the innocent spouse rules. I am a layman and have no idea of where to go from here, looking for help any you can give me is very much appreciated. Thank you.
Yes, you & he can do a 1031 with your land. You must hold the property for 2 years, otherwise the transaction becomes taxable as if you never did the 1031.
I am not sure that in a 1031, he is not able to buy your land directly. Call whomever you would use as an intermediary and ask them.
Brenda
As far as I am aware, there is no prohibition against using farm land in a 1031 exchange. Please tell us your source for this if it is in fact prohibited.
Farmland can b used for a 1031. What is prohibited is purchasing farmland from a direct decendant (father buying from son). That was my main worry.
Related party exchanges are permitted, though there is a two year requirement on the use of the property by the party receiving the 1031 property.
If you have a source that tells you a related party exchange is prohibited for farm land, please tell us where to find it.
we belive that the house is worth 95,000. Yes the wife has lived in the house off and on over the last three years. She is a travel nurse and traveled a lot. She has lived in Delaware the last 18 months.
Part 2 ---
If your wife does not qualify for the capital gains exclusion on the sale of a primary residence because she does not meet the 24 of 60 month ownership and occupancy requirements, then the sale of the house is a taxable event.
If the sale price is $95K, taxable profit will be computed on the net sale proceeds. If you want to give your daughter $30K from the sale proceeds, you might be able to reduce your taxes by making a $30K seller concession for repairs and renovation in the purchase contract. Now, at settlement, the $30K is deducted from your net sale proceeds and your tax burden is reduced.
As an alternative, do the remodel yourself prior to the sale then adjust your cost basis accordingly. Now your taxable profit on the sale is reduced by the amount of your improvements.