A national nonprofit released a tax proposal enabling parents and grandparents to exclude capital gains taxes on up to $50,000 in gifted investment sales. The proceeds must be used by children or grandchildren as down payments for first-time home purchases within six months. This cap applies per taxpayer and can benefit multiple children. The exclusion shifts the tax advantage from holding assets until death to immediate assistance for home purchasing, targeting young buyers. The outlined plan aims to utilize significant investment capital to facilitate homeownership for the next generation.
The proposal would exclude taxes on capital gains on the sale of up to $50,000 in stocks, bonds, and mutual funds when proceeds are gifted to a child or grandchild for a first-time home purchase.
The exclusion may be taken for more than one child or grandchild, allowing for a tax-efficient transfer of wealth to support first-time home purchases.
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