Tax considerations for selling a property below appraised value to family? However, selling your home for a price below the market value does not relieve you of your duty to satisfy any liens on the property. You can sell your house for any price a buyer agrees to pay for it, even if that price falls short of your home's market value. This is because the difference between the market value of the property and the price it was sold for could be considered to be a gift to the person to whom she sold. how can i sell a house below market value to family? In your case it would appear to be £190,000. Selling to a family member or friend; Poor performance on the open market; Low listing price for a quick sale Moreover, if the family member turns around and sells it too fast, … Can I sell it to my daughter (a single parent) for less than this? Similarly if they buyer hands you a wad of cash in respect of the discount then this too might give rise to a gift tax liability. Selling below market value to family will attract IRS scrutiny. Here are seven reasons a seller could be motivated to sell their property quickly and allow you to get a deal on the property. If you give a property to family or friends, or sell it to them for less than market value, and you're entitled to the main residence exemption, it will still apply. Someone selling at a loss way below the market value - there must be something wrong with the property. If this house is your principal private residence then the sale should not trigger any capital gains tax liability for you. Gifted Property Explained My house (my only property) is perhaps valued at £190,000. For tax purposes this is the figure for which you are deemed to sell it, and it is also the figure your daughter is deemed to buy it for. Selling A Property To A Family Member At Below Market Value There are many reasons why someone will consider selling a property to a family member at below market value – but this kind act can have a sting in the tale with a hefty tax bill if you don’t take the appropriate steps. If you set it too far below the market value, the IRS may consider it a gift and expect you to pay a gift tax on the difference. Sell the home more than 25% below market value, and it’s likely the buyer will get hit with a gift tax courtesy of Uncle Sam. Types of Under-Market-Value Home Prices In any given market at any time of the year, you're likely to find home prices that sound too good to be true.