I have a question that I hope to get some help with from the BP community. My fiancé has a condo under his name, which he currently occupies as his primary residence. He also has another condo in a senior community under his name, where his mom currently occupies, so it's not an income property. The senior community condo is owned free and clear, and he said he took title to help manage the paperwork and pay taxes on behalf of his mom, but the equity in the condo belongs to his mom. Now his mom is looking use the equity in the condo to buy a home in a different area. Since the senior community condo is under my fiancé's name and it's not considered a primary residence for him, he most likely will incur income taxes if he sells it. He'd also rather have his mom take title on the next home. My question is - can we do a 1031 exchange to use the equity in the condo for the purchase of the new home so that he and his mom can avoid the income taxes, and then he quitclaims the title of the new home to his mom?
If anyone knows a good real estate CPA in the Orange County (Irvine) area, please let me know.
Thank you in advance for your inputs!
Why not just QCD the condo back to the mom now, let her sell it? Since it’s not an investment property a 1031 is not available anyway.
Hi Wayne @Wayne Brooks ,
Thank you for your input. I'll convey the message to my fiance. His mom is dealing with some personal matters at this time, so she is not in a good state to handle the sale of the condo, and therefore she's relying on my fiance to sell the condo. But if QCD at this time helps with the taxes, then she probably will consider it.
Get him Power of Attorney and quitclaim back to her maybe.
Why not create a Trust or some entity that will allow the son to be in control while giving the mom the ability to move the equity to a new property and not have tax implications? For example, "Joe Smith, Trustee of the Mom Smith Trust" shows Joe as the acting person but it is Mom's ownership.