Ask Tax Dad: Mobile Home Sale, Sisterly Support, And Son Leaves The Nest

TAXDADSEZHistorically, our staff Certified Tax Cat has handled readers’ questions about taxes, but he took feline early retirement and hung up his oversized eyeglasses. Filling in for him is Laura’s dad, a retired accountant and real live independent tax preparer. Exclusively on Consumerist, Tax Dad answers your questions.

Leia writes:

I sold my old manufactured home (mobile home) that I had been living in since 2006 in April of 2013. I immediately purchased a new manufactured home in the same park. Technically, I made $5,000 from the sale of my old home based on market value.

The new home carries a 226K mortgage, so it cost much more than my old home was worth. I put $18K down on it. What deductions can I take for the purchase of my new home? Do I have to report the ‘capital gains’ from the sale of my old home?

PS. The purchase and sale of both homes was conducted through the same company.

Congratulations on your new home purchase! You do not tell us if your manufactured home was/is strictly your principal residence, but if so, there would be no capital gains on that sale. If you were renting out all or part of the old home or using part as a home office, there may be capital gains or depreciation recapture involved.

As for the new home, you could deduct costs for mortgage interest, loan points, property taxes, if any, and possibly mortgage insurance as itemized deductions on your income tax return. Closing costs, legal fees, and other fees of the home purchase would not be deductible.

I always tell clients keep a file of all capital purchases, improvements, and sales as long as they own the home. The rules may change in the future before you sell the home.

I hope you can help me. My mother has Alzhiemer’s and cannot live alone. So I quit my job, sold my house, and moved in with her to take care of her. 2013 was my first full year of being unemployed. My sister cuts me a check monthly out of my Mom’s account to help pay my bills and also some of the living expenses (internet, phone, groceries) for both my Mom and I.

Do I have to file taxes on this amount or can it be considered a gift? I receive no money from the state or the federal government, no food stamps or relief.

-Jeff

There are a lot of unanswered questions here, such as your age, any other income you may have, your mother’s income, whether you had a gain on sale of your home, how much you are being paid monthly, etc. Generally speaking, if you are being reimbursed only for household expenses, you would not have taxable income, and your mother could claim you as a dependent relative, as she provides your support.

If you are being compensated for your caregiver services, this could be considered a tax-free gift from your mother. I suggest you contact a tax professional.

My 18-year-old son lived with me from Jan 1 to July 1, when he got a great job and moved out on his own. I think he made close to $15k for the year.

Can I still claim him as a dependent?

- Steve

You need to answer some important questions here, in order to determine if your son was your dependent. When during the year did he turn 18? Was he a student in 2013? Since he lived with you for half of the year, did you provide over half of his support for the year? Probably not.

Did he use his earnings for something other than supporting himself? If he earned over $15000, it would be to his advantage for him to claim himself for the year.

Here’s an interactive worksheet on the IRS website that might help you determine who is or isn’t your dependent.

Disclaimer: The nature of free advice is that you often pretty much get what you pay for. Questions answered in the “Ask Tax Dad” column should not serve as a substitute for consulting a tax preparer, accountant, tax attorney, or certified tax cat of your very own. Tax Dad regrets that he cannot offer advice privately over e-mail.

Have a question for Tax Dad about your federal or state tax returns? Send it to us at tips@consumerist.com with “ASK TAX DAD” in the subject line. We’ll run the answers as soon as we can get him to stop Photoshopping pictures of wild grouse.