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, and Enrolled Agents.
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
Instructor
Klaralee R. Charlton
Klaralee Charlton is a Partner at 3i Law in Denver, Colorado. She practices fiduciary tax, estate administration, and business transactional law. As part of her practice, she guides clients through the process of administering a loved one’s estate including the collection, valuation, management and transfer of assets including financial accounts, real estate, and business interests with a focus on minimizing estate and income tax liability. Klaralee also works closely with trustees of ongoing trusts to ensure compliance and prepares clients’ fiduciary income tax returns annually.
Klaralee has written and lectured on topics including estate and gift tax, fiduciary income tax reporting and U.S. regulations governing the valuation of small family businesses. She is an active member of the Colorado Bar Association, Tax Section and Adjunct Profession at the University of Denver, Graduate Tax Program.
She earned her J.D. in 2011 from the University of Utah, S.J. Quinney College of Law, her LL.M. in Tax Law from the University of Denver in 2013, and her B.A. in political science in 2009 from Bryn Mawr College. She is admitted to practice in both Colorado and Montana.