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My brother was given the family home and now is in the process of selling it. The proceeds are to be equally divided (less expenses, taxes) between my brother, myself and my sister. He is setting up a monthly payment plan plus 6% interest over seven years for the buyer. He has consented to paying our two-thirds up front so that we do not have to wait for a payment each month. He wants to deduct his capital gain taxes from the sale price. Can my sister and I claim the capital gains tax as a deduction or only him since he's paying for our share?
ANSWER
Expert Thomas Graham iii's Answer:
In this instance your brother would be the only person eligible to receive the capital gains tax deduction. The reason for this is that he is the seller and the asset being sold belong to him and him alone. Also, you will need to be careful because the money given from your brother to you and your sister could also face "gift" taxes if over a certain amount.
