Do your aging parents live in a home that's soared in value? Chances are, they've paid off the house, so they're not claiming mortgage interest deductions anymore. Even if they still deduct mortgage interest, they're probably in a low tax bracket now, so those deductions don't do much good anyway.
Your parents may take the standard deduction rather than itemizing.
Advice: Buy your parents' home, and then lease it back to them at the going rate. That way, your parents can tap into their home equity without moving away, and you're able to reap the sweet tax benefits of rental-home ownership.
Generate rental-property deductions
That transaction puts much-needed cash into the parents' pockets. For starters, your parents may not owe any federal income tax on the sale. Tax laws allow married couples to avoid tax on up to $500,000 of home-sale gains on a principal residence. If only one parent is the seller, the m...(register to read more)