<div dir="ltr"><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763">Listmates,</div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763"><br></div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763">I certainly am not a tax advisor so I may have my terminology wrong here, but here goes:</div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763"><br></div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763">Client advises that he and his spouse need to sell their property within a month from now to capture the $500k exclusion from capital gains on sale of personal residence. Client wants to proceed with a seller-financing transaction to a buyer who will pay little-to-nothing down. Can Client capture the full benefit of the $500k exclusion on such a transaction even if no (or very little) cash gain is recognized at the closing? Does it make a difference if it is Note/DOT vs. REK? </div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763"><br></div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763">Seems to me the exclusion would only apply to gain actually recognized prior to the deadline (i.e. at closing), because to allow otherwise would seem to create a loophole for Client to capture the benefit by simply transferring the property to an insider (who could then subsequently sell the property to a third party, without concern over the deadline, and then agree (on the side) to a profit sharing arrangement with the original owner/Client). </div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763"><br></div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763">Hope that makes sense. Any insights? Thanks in advance.</div><div class="gmail_default" style="font-family:verdana,sans-serif;font-size:small;color:#073763"><br></div><div><div dir="ltr" class="gmail_signature" data-smartmail="gmail_signature"><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><div><div dir="ltr"><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><b><font face="verdana, sans-serif" color="#073763"><br></font></b></p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><b><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">David C. Daniel</span></b><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">, Attorney</span><br></p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">
<u>^{____________________________________}</u><br>
</span><b><span style="font-size:13.5pt;font-family:Garamond,serif;color:rgb(7,55,99)"> DEMCO
LAW FIRM, P.S.</span></b><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)"><br>
<u>^{____________________________________}<br>
</u><b>Office |</b> (206) 203-6000<br>
<b>Email |</b> </span><u><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(17,85,204)"><a href="mailto:ddaniel@demcolaw.com" target="_blank">ddaniel@demcolaw.com</a></span></u><span style="font-size:12pt;font-family:"Times New Roman",serif"><span></span></span></p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial">

</p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">5224 Wilson Ave. S., Suite 200</span></p><p class="MsoNormal" style="background-image:initial;background-position:initial;background-repeat:initial"><span style="font-size:11pt;font-family:Garamond,serif;color:rgb(7,55,99)">Seattle,
WA 98118</span><span style="font-size:12pt;font-family:"Times New Roman",serif"><span></span></span></p></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div></div>