CanI buy a 1 million dollar house for my dad in another state in exchange for land that he owns?

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CanI buy a 1 million dollar house for my dad in another state in exchange for land that he owns?

Asked on January 10, 2012 under Real Estate Law, Nebraska

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If you and your father have an agreement (preferably in writing) where you purchase a home for him for $1,000,000 in one state and he in turn transfers title to you of land that he owns in another, that can be done. You should have a formal escrow set up as well for the transaction.

However, I suggest that you consult with a real estate attorney with respect to structuring the transaction in such a way as to minimize possible capital gain taxes by way of a like kind exchange under 26 U.S.C. section 1031 of the Internal Revenue Code and reviewing the issue of property taxes where a carry over assessment might be allowed.


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