Long Term Capital Gains

[Ramesh M]

I have two properties A and B in my name. I've had both the properties for over 3 years. I want to sell property B. I don't want to reinvest the gains in another property.
To claim exemption from tax, can i gift property B to my wife and then make her buy property A from me using the gains? Will this work?

Regards,
Ramesh

[DR.MARIAPPAN GOVINDARAJAN]

No. Capital gains will attract.

AI Summary

Capital gains: interposed gifts to a spouse do not avoid tax on gains from property disposition. The taxpayer proposed gifting Property B to his wife and having her buy Property A to avoid reinvestment, but that arrangement does not prevent tax: capital gains arising on the disposition remain taxable.