Many people transfer real property (land) to their family members during their lifetimes. As of late, you only have to pay gift taxes for gifts exceeding $5 million. However, while you are not required to pay gift tax on gifts made with a value under $5 million, you are still required to file a Form 709 for gifts made to family members (and anyone else) where the gift value exceeds $13,000.
While most people may not even be aware that such form is required to be filed, it is important to stay abreast of such requirements to avoid fines and penalties.
This is why consulting with an experienced attorney is beneficial when making such decisions. An experienced attorney will be able to inform you about the tax benefits and consequences of making such a transfer. In addition, the attorney will alert you as to what forms need to be filed and will assist you with their preparation.
The IRS is seriously buckling down on those who fail to file the required 709 Form when making a gift of real estate to family members and has examined hundreds of people who failed to file such forms.
Avoid having your transfer scrutinized and talk to an attorney at the Law Offices of Albert Goodwin at (212) 233-1233 before making any transfers of real property.