Purchasing adjoining land

2 Replies

I purchased a three-quarter acre lot on a lake And will be building a new home in the spring. I would like to purchase the vacant lot next-door also. I contacted the owner son and he told me that the property is in a trust for him when his mother passes away he is open to sell it but he cannot sell until his mother dies because they do not want to pay gains taxes on the property. Does anybody have any ideas of how to acquire the property with these circumstances?

Depends on seller’s tax situation but an installment sale might lessen their tax burden so for the right price...

Or maybe a master lease with some sort of option to buy upon owner's/trustee's death?

You should discuss with both an attorney and an accountant if they’re willing to explore creative options. 

@Rick Oaks

There are a number of different ways to do this. Do they own this land outright or do they have a mortgage on it. If the seller is open to it, you should get a lawyer and accountant to look at the trust to make sure there will be a step up in basis upon his mothers death.

If they own it outright probably the lowest tax consequence would be to do seller financing with an option to buy if the owner changes. Such as a transfer from his mother to the trust in his name. Its doubtful that small payments right now would make much of a difference in his mothers tax bracket, but this may be a harder thing to convince them of.