My wife and I purchased a home from my parents 2 years ago. We financed the transaction privately through them, and have a promissory note to pay the balance of the purchase price of the home. We now are looking to re-finance the home with a broker but have a lien on the house for the value of the promissory note. To complete the re-financing process, we would need to remove the lien from the home. We have been told by our broker we could simply re-convey the lien, receive the re-financing funds, and then place the lien back on the home. Would doing so:

A) Constitute as a gift from my parents?, and;

B) Would property taxes be potentially re-assessed following the filing?

Any advice/help would be greatly appreciated!

A) Constitute as a gift from my parents?, and;====>>>>Yes I think so UNLESS you pay it off ; You can give up to $14K($28K for joint filers, gift splitting allows a couple to increase their total gift tax exemption amount by combining individual allowances.) for 2015 worth of assets each year to as many people as you like gift-tax free; aslongas the amt exceeds $28K; If ONE of them gives a check for between $14,001 and $28K they need to file ONE form of 709with both signatures. If ONE of them gives a check for $28001 or more, then they BOTH would need to file forms of 709 because BOTH of their would be nibbling into the $5.45Million lifetime gift exclusion.
You, as a done, are not subject to nay tax and do not need to file form 709.

B) Would property taxes be potentially re-assessed following the filing?====>>I guess you need to contact your County Tax Assessor’s Office or Tax Collector’s Office for more accurate info in detail; the County Assessor will reassess you property at the time of sale for all of your future taxes that will need to be a reassessment does not necessarily mean that your assessment or your taxes will increase. Furthermore if your assessment does increase, it does not necessarily mean your taxes will increase.

Yes also UNLESS they require you to pay it off