Hi, this may be a stupid question but I am willing to ask it because I want to learn.This youtuber Mr. beast does a bunch of giveaways and in a new video he sells a house for $1. Doesn’t the irs require you to sell houses around fair market value? As far as I know the gift limit is around 15k and there is no way he can rationally drive the sale price down due to “needed repairs”. Also, whatever your theory/explanation is, would you recommend buying from relatives or parents who would offer you a house under fair market price, or is there a better strategy?
Hi @Richard Vinson , the IRS can't (yet) force someone to sell X, Y, or Z at any rate to a party that is arms-length from the seller (not related and such). They can, however, tax the buyer at X, Y, or Z rate and this is likely what you are thinking of.
As to how this YouTuber can do this . . . it's pretty cut and dry In this video there's something like $300,000-$500,0000 "given away", sold, or donated. The channel has around 54 MILLION subscribers and this video alone had 26,000,0000 views at the time I clicked on it. There is a bundle of ads at the beginning, middle, and end and a baked in advertisement for Basketball Arena. I'd bet for this video with their subscriber base they are clearing well in excess of any money spent in this episode, which is the "why" behind this lunacy. It's entertaining :)