Taxation of the Family Home

Author: Klaralee R. Charlton

Every practitioner at some point will be asked questions related to the tax consequences of buying and selling a personal residence. This course will provide an overview of the rules related to selling the family home during life, in the event of a divorce, and after death. Planning tips will also be discussed to enable clients to save taxes on the sale or transfer of their largest asset.

Publication Date: November 2021

Designed For
Attorneys, CPAs,

Topics Covered

• Overview of the Personal Residence Gain Exclusion under IRC 121
• Analysis of Converting a Personal Residence to and from a Rental Property
• Description of the Date of Death Basis Adjustment under IRC 1014
• Explanation of the Tax Consequences of Interfamily Transfers and How to Avoid Adverse Tax Consequences
• Planning Ideas to Optimize Income Tax Consequences on Sale of Personal Residence

Learning Objectives

• Recognize how to explain the rules related to the personal residence gain exclusion under IRC 121
• Identify the interplay between the personal residence gain exclusion and the date of death basis adjustment
• Describe the differences in calculating taxable gain when a personal residence has been converted to or from a rental property
• Recognize how to analyze the tax consequences related to the sale or transfer of a personal residence in light of varying circumstances
• Identify how to advise clients on optimal timing for transfers of a personal residence to minimize income tax
• Recognize correct statements regarding determining the principal residence for purposes of Code section 121
• Recognize which Internal Revenue Code sections addresses gift loans
• Identify what amount should be reported as gain on the estate tax return in various scenarios

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
None

Advance Preparation
None