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Posted by A.G. Kalman on January 19, 2007, 8:06 pm
Please log in for more thread options Stuart A. Bronstein wrote:
> ysmrysmr@gmail.com wrote:
>> We are husband and wife, and file 1040 jointly every year.
>> We are not US citizen nor green card holders, but US
>> residents (resident aliens) for US tax purpose. We are now
>> selling our primary residence that is jointly owned by us.
>> We have lived in this house for more than 10 years. After
>> selling this house, we would like to divide the proceeds
>> into half and half between us since we feel that both of us
>> contributed equally to build this asset. Then deposit each
>> half into respective personal bank account of us. The total
>> amount of proceeds will be about $500,000. I believe this
>> action of dividing the proceeds into half and half between
>> us, although one of us mostly paid mortgages, does not
>> produce any tax problem since we file 1040 jointly. One
>> concern is if the tax authority might see it as gift giving
>> from one spouse to the other, in which case paying some tax
>> may be necessary. Can some one confirm that this is not a
>> problem.
> It depends on a lot of things. Which state do you live in?
> How long have you been married? Where did the money come
> from to make the initial down payment on the house? Where
> did the money come from to make the mortgage payments for
> the last ten years?
>
> The answers to those questions will lead to other questions.
> But until they are all answered, your question cannot be
> answered with any certainty.
Stuart: I don't understand how the length of marriage,
state of residence, and source of funds matters. They are
married and jointly own their home. How they split the
sales proceeds is not a taxable event. Please explain.
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