Capital Gains On Gift Of Equity Sale
About 4 years ago my brother purchased a townhome for me. I am currently trying to purchase the home in a Gift of Equity transaction. The sales price is $180K and my brother owes $145k on the townhome. Will he be hit with capital gains on the $35k difference?? And if so, about how much? Thanks for any offered info.
The difference between his purchase price and the sale price is a rough estimate of his taxable profit. The amount of the mortgage loan is not a factor in the taxable profit calculation.
Right now, the maximum long term capital gain tax rate is 15%.