Business to Business gift tax from parent to child

[MOONSHINE MAFIA]

Parents have LLC with residential property.

They want to transfer the property to child's LLC.

Are parents protected by Lifetime Gift tax or would then taxed immediately?

[TaxGuyBill]

Are both LLCs "Disregarded Entities" (a Single Member LLC that has not made an election to be taxed as a corporation)?

[sjrcpa]

If not, the property is deemed to be distributed to the parents who then give it to the child and then the child contributes to their LLC.

:Parents can use their lifetime estate and gift tax exemption for the gift. either way.

[BobKamman]

Is it being used as a residence by a family member, or is it a rental?  Is there a mortgage on it?  Is the amount owed greater than the basis?

[MOONSHINE MAFIA]

They are just converting to Inc. status. 

[MOONSHINE MAFIA]

thank you very much. would it make a difference if they were INC's

[MOONSHINE MAFIA]

Rental, owned outright. No mortgage.

[qbteachmt]

"would it make a difference if they were INC's"

They, which party? Inc, which type?

It's not advisable to hold real estate in an S Corp.

[BobKamman]

I think what you mean is that it is often not a good idea to hold rental property in an S Corp when there is no other business activity.  Certainly, if I own a factory that has $100 million in annual sales, the building itself can be in my S Corp.  Or I might want to own it myself and lease it to the company, but then I get sued by the employees and visitors if anyone is injured there.