Tax Consequences of being GIVEN a Home worth 80K?

Question

A friend of mine, (divorced woman in her 40's) has been given a home by her Grandfather, worth about 80K. She is not going to live in it and will use it as a rental property. Are there any tax consequences of having something of this value given to you? There was paperwork drawn up where he sold the home to her for ten dollars. I am not sure if that is even legal. Any thoughts or comments are appreciated. Thank You.

PS: This transaction took place in the State of Texas.

Answer 1

It sounds to me like your friend bought a house for $10.  You can sell your house for whatever you want to sell it for, it's legal.

Tax implications MIGHT appear if she were to sell it, then only if it's not her primary residence and only if the profit is over $250k if it is her primary residence.

Your friend should consult a tax accountant.