Donation question
I recently joined with a group of neighbors to contribute money to buy a piece of property back from a developer who wanted to build apartments on a very small piece of property in our neighborhood. One person paid the bulk of the amount, so the rest of us just donated the money we contributed to his acquisition of the property. He is the sole owner now. My contribution was $5k. How do I report that on my taxes for this year? I was asked by the real estate office to complete a tax form for the amount I contributed. I live in WA state.
Answers
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The $5,000 amount that you contributed to the now owner amounts to being a gift, and does not need to be reported on your tax return in any way.
Ask the real estate office what kind of form they want; there is no tax form that I can think of that would exist solely to report a gift that has no tax implications.
If the individual who owns the property now has a 501(c) organization, then it could be considered a charitable donation and subsequently could be reported as such, alongside your other itemized deductions.
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ok…..thanks!
