🏠 Never Sell Your House to Your Kid for $1

Summary

Selling a house to a child for a nominal amount like $1 might seem like a good gesture, but it can lead to significant tax implications when the child decides to sell in the future, as they'd be taxed on the gains from the original purchase price. A better alternative is to set up a trust naming the child as the beneficiary, which allows them to only pay taxes on gains realized after they inherit the property, potentially saving them a substantial amount in taxes through a 'step-up in basis'.