My daughter and I share a profit from a home we sold. Is my portion subject to capital gains tax?

by Susan D. Jarvis, CPA | Jan 25, 2018

I purchased a house with my daughter four years ago for her to live in. It has been her principal residence, but I have not lived there. We recently sold the house, and the profits from the sale were split between us. My share was $9,150. I am giving the money to my daughter and her husband. We have not sold any other property in the past four years. Am I subject to capital gains tax on my portion of the sale?

Yes, your half of the proceeds are subject to capital gains, if there is a gain. Your daughter won’t be subject to the capital gains tax if she lived in the home as her primary residence in two out of the past five years.

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Answered by: Susan D. Jarvis, CPA, is a sole practitioner in Nazareth, Pa.

The responses are based on the limited information provided by the questioner and apply the laws and regulations at the time of posting. Other options could arise as rules and regulations may change over time, including but not limited to the passage of the Tax Cuts and Jobs Act of 2017. They are intended to provide general information, not specific accounting or tax advice; they are not intended or written to be used and cannot be used for the purpose of avoiding or evading taxes or penalties under the IRS code or regulations. Views expressed do not imply an opinion of the PICPA, its officers, directors, employees, or members.
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