[WSBARP] Gifting Exemptions

[Nick Pleasants]

Mark,
That gift of the LLC to child should be ok, but you would need to file a change of controlling interest report https://dor.wa.gov/sites/default/files/2022-02/84-0001b.pdf and a Supplemental Statement http://dor.wa.gov/Docs/forms/RealEstExcsTx/RealEstExTxSpplmtlStmt_E.pdf
Review the Supplemental Statement to make sure there is no mortgage on either property. If there is a mortgage, then this gets a lot more complicated.
Also we would issue a letter advising them the gift needs to be reported to the IRS on a Form 709, and they should engage a qualified CPA to prepare and file that.
Best,
Nick

Nicholas Pleasants | Shareholder

[OseranHahnAttyatLaw 8]

11225 SE 6th Street | Suite 100 | Bellevue, WA 98004
Main: (425) 455-3900 | Fax: (425) 455-9201 | E-mail: npleasants at ohswlaw.com<mailto:npleasants at ohswlaw.com>

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From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Mark Anderson
Sent: Wednesday, July 13, 2022 3:42 PM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: [WSBARP] Gifting Exemptions

Parents own Parcel #1 and want to gift it to child.  Parents are also the sole members of and LLC, which owns Parcel #2, a different parcel of real property.  Parents want to gift 100% of their membership interest in the LLC to the child.  After all is said and done, child wants the LLC to own both Parcel #1 and Parcel #2.

I know that if parents transfer Parcel #1 into the LLC, that transaction is exempt from excise tax under WAC 458-61A-211.  If parents then gift the LLC to their child, can that transfer be exempt from excise tax as a gift?  How would that gift be documented?

Thanks in advance.

Mark B. Anderson
ANDERSON LAW FIRM PLLC
821 Dock St  Ste 209  PMB 4-12
Tacoma, Washington 98402
+1 253-327-1750
+1 253-327-1751 (fax)
marka at mbaesq.com<mailto:marka at mbaesq.com>
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