Tax due on monies received from being "bought out" of family home inheritance

Sunnysoutheast

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Two brothers A and B are due to get a 50% inheritance each as their father has died (mother died some years ago). The family home is part of the inheritance. Neither of the brothers have lived in the family home for 20 years.

Brother A wants to keep the house, Brother B wants to sell it. Brother B asks Brother A to "buy out his half of the house". What are the tax implications for Brother B if his half share of the house is sold to Brother A? (I.e. what tax is due to be paid on the monies given to him by Brother A to buy out his 1/2 of the house? What is the most tax efficient way to proceed?).

Brother B is already nearly at the threshold where he needs to pay CAT on monies he has received from parents in his lifetime.
 

Pinoy adventure

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What’s the value of the property ?
Is brother A in a position too buy brother B or would there be a mortgage involved ?
 

NoRegretsCoyote

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What are the tax implications for Brother B if his half share of the house is sold to Brother A?
As I understand it none once the sale is at the same valuation used for probate.

He has already paid CAT (if over the threshold) on the inheritance so can't be taxed again if he sells.
 

Sunnysoutheast

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What’s the value of the property ?
Is brother A in a position too buy brother B or would there be a mortgage involved ?
Not sure of value, could be as little as €150k or as much as around €300k. No work has ever been done to the house and it needs a complete gutting, however it is in a very good location.

Not sure of the latter question but brother could probably buy out without a mortgage.
 

Sunnysoutheast

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As I understand it none once the sale is at the same valuation used for probate.

He has already paid CAT (if over the threshold) on the inheritance so can't be taxed again if he sells.
Ok thanks. Brother B may need to sell his part of the house to Brother A in order to have cash to pay the CAT due on his part of the house...there may be problems if Brother A can't or won't buy out Brother B and also refuses to sell the house.
 

NoRegretsCoyote

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there may be problems if Brother A can't or won't buy out Brother B and also refuses to sell the house.
Indeed, but these are not really tax questions.

Often a good way to structure these things is by way of a low-interest loan from one party to the other.

Having seen this a few times though in extended family the best solution is generally to sell the house.
 

Sunnysoutheast

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Indeed, but these are not really tax questions.

Often a good way to structure these things is by way of a low-interest loan from one party to the other.

Having seen this a few times though in extended family the best solution is generally to sell the house.

Thanks for your response, good ideas there.
 
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