Hello, new member here. I have a question regarding to parent gifting property to child. Let's say the parent owns a property which they purchased for $450,000. The market value for the property is now $900,000. If the parent gives the property to a child, the child assumes the basis value of the property at $450,000. The child will be responsible for capital gain tax when the property is sold. However, is the child also responsible for the $450,000 gift tax? Thanks for any help.

Hi and welcome to this site! To answer your question, any gift under $12,000 (for the 2006 tax year) is not taxable. So yes, someone will be responsible for paying the taxes on the value of the land.

On a side note, a lot of wealthy people try to do creative financing around tax time to avoid paying large tax amounts. I have known of instances where cash gifts of $11,000 are distributed amongst all the children and especially infants. The money isn't actually given to the children but saving accounts are set up in their names and the money is deposited so on the tax forms it can be shown as a gift but in reality it was just moved from one account to another.