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  1. #1
    Join Date
    Jan 2008

    Can I buy my kid a house

    What is the name of your state?

    Can I buy my child a house and not require rent to be paid? Is this considered a gift? If it is a gift under IRS rules and the total of the gift (rent/taxes/utilities or anything else I might pay for) stays within the gift amount (that being 12K a year or even 24K if my spouse gifts it too) is this arrangement legit as far as IRS?

  2. #2
    Join Date
    Feb 2005
    Elgin, IL USA
    If the home is purchased by you and deeded to you and give the kid free rent it may be hard for anyone to finger a specific value. So you should be able to keep it within the annual gift exclusion one way or another.

    But if you buy a home and deed it to the child, "you" would most likely need to file a federal gift tax form [even if no tax is due within unified (lifetime) credit limit]. For stepped up cost basis reasons it is usually better for them to inherit it than to gift it to them now.

    You also need to check requirements for your state (which you forgot to mention).

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