[WSBARP] Excise Tax Issue

[Roger Hawkes]

I hope you find an exception; but I think generally debt relief is part of the 'price' of property and gets taxed.

-----Original Message-----
From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Paul Neumiller
Sent: Wednesday, November 28, 2018 12:00 PM
To: wsbarp at lists.wsbarppt.com
Subject: [WSBARP] Excise Tax Issue

Listmates, client co-owns residence with family member.  Both on mortgage and deed of trust.  In a buyout deal (with nothing in writing), client gives family member a quitclaim deed and receives $20k (representing 1/2 of the equity in the residence.)  Client paid excise tax on the received $20K.  BUT BUT BUT, family member refinanced the residence and now the County is arguing that client now owes the County about $6k more in excise taxes due to the "forgiveness of debt on the transaction."  Any thoughts on where I can start or is client hosed?