Tax Treatment of HUF
This query is : Resolved
03 December 2007
Situation
HUF has created in 1991 with inheritance property. At that time one residential plot has purchased by the Karta in his name for the HUF and fund for the same has also given by the HUF. Now in 2007 HUF sold this plot and investing the sale value in Residential House to avoid the Capital Gain Tax. HUF has purchased the new residential house in the name of HUF. Now they want to dissolve the HUF and distribute all the property of the HUF amongst their members.
Queries
1. Whether Karta can purchase the new residential house in his name out of the funds given by the HUF.
2. Whether female members of the family (wife and daughter of the Karta) will be considered the members of the HUF for distributing the property of the HUF.
3. Whether legal title of the property should be transferred in the name of the members for the requirement of the Income Tax Act.
4. What will be the acquisition date for the members for calculating the capital gain tax if they sold the property after dissolution of the HUF.
5. Whether individual members can be made their own HUF out of the property and funds received from the dissolution of the HUF.
6. Whether any time limit is there for selling the property of the HUF by their members after the dissolution of the HUF.
HUF has created in 1991 with inheritance property. At that time one residential plot has purchased by the Karta in his name for the HUF and fund for the same has also given by the HUF. Now in 2007 HUF sold this plot and investing the sale value in Residential House to avoid the Capital Gain Tax. HUF has purchased the new residential house in the name of HUF. Now they want to dissolve the HUF and distribute all the property of the HUF amongst their members.
Queries
1. Whether Karta can purchase the new residential house in his name out of the funds given by the HUF.
2. Whether female members of the family (wife and daughter of the Karta) will be considered the members of the HUF for distributing the property of the HUF.
3. Whether legal title of the property should be transferred in the name of the members for the requirement of the Income Tax Act.
4. What will be the acquisition date for the members for calculating the capital gain tax if they sold the property after dissolution of the HUF.
5. Whether individual members can be made their own HUF out of the property and funds received from the dissolution of the HUF.
6. Whether any time limit is there for selling the property of the HUF by their members after the dissolution of the HUF.
23 January 2010
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