credits to purchase price taxable income?

so...if the asking price is $1.0 million and you buy it for $900K, the difference is income to you? no way. just changes your basis price when it comes time to sell.

I think OP is thinking of a situation where asking price is $500k and developer accepts an offer of $500k with $10k credit towards closing, effectively reducing the price -$10k but allowing it to go on public record as selling at ask.

Not sure of the answer to the question but i can definitely see how it would be classified as income.

You should ask your seller if he/she will issue you a 1099. I would think is not taxable, similar to cash rebate cards. Is not taxable because you are essentially getting a piece of your purchase price back.

jm: For those of us interested in prices of condos, can you give the % of sale price that the developer is offering as a credit?

NY state has "interesting" sales tax laws, and I wouldn't be surprised if a developer and the state assembly conspired to do something similar....

The loophole re: NY sales tax is that a "manufacturer's coupon" or "rebate" does not discount the sale price -- and the total gross transaction is taxable, and the manufacturer rebates the retailer, or the customer. It doesn't matter that the customer is only paying the net discounted (post-coupon or rebate) price -- NY state is going to get sales tax on the gross transaction.

Now, if a RETAILER or reseller DISCOUNTS the gross transaction, the sales tax is collected on the net selling price.

So there is a distinction between a MANUFACTURER coupon or rebate, and a RESELLER discount.

Makes no sense to me -- the net sales price should be the price that is taxed. And WHY should it matter if the manufacturer or the dealer offer the discount?

Situation #1. Let's say a manufacturer partners with a reseller -- hypothetical $1000 item. Cost of goods is $100. Wholesales for $500, Retails for $1000. Manufacturer and Dealer agree to each kick in $200 of margin and sell the item for $600... so what is the taxable price?

$800.

Situation #2. Charity auction. A high end jeweler agrees to donate 20% of the sale price of an item to the charity. Item sells for $100,000. How much sales tax is collected? Wouldn't it be much better for the charity if the transaction were split into parts -- $80,000 to the jeweler (taxable), and $20,000 directly to the charity -- why should NY state collect sales tax on donations to charity.

DON'T tell me this can't happen -- I have a ruling from NY State for a charity event I was co-chair.

SO -- it doesn't surprise me if our assembly has figured a way to turn a sales concession into a taxable event. They are very capable of doing this.

I am not an accountant nor a lawyer, so don't take a word of this as advice... but I agree with others that NY state is very capable of twisting the INTENT of a concession or discount, and turning into a taxable event.