how do i do shared equity financing on my daughters new condominium purchase
she is single-has govt job-short on ready cash-close family
relationship-thinking 50/50 agreement-what are legal/tax
ramifications/dangers
thanks abe

I'm neither an accountant nor a lawyer. You really should check with
both. However....

You can set the arrangement up as you wish (for instance, 50/50). The
question is--what are you providing in return? Presumably cash in
return for equity. You should have a written agreement spelling that
out. Identify in it your cash contribution and a method for
determining equity. For instance, is it based on equity at time of
purchase? Or equity at time of the agreement? In some real estate
markets today, that can be significantly different. For instance, in
the DC area, you might sign a preconstruction contract for a condo at
$275,000; by the time it's finished it's worth (and others are selling
at) $350,000.

The agreement should also spell out the exit strategy. For instance,
is the agreement for a specific period of time, or is it open-ended?
And at the conclusion, in either case, what is she required to do?
Sell the property? (That's the logical step, but what if she wants to
hold onto the property as an investment. Is there a procedure for you
to receive your equity, if you want it?)

Again, I'm not a lawyer, but you may want to watch out for the balance
between your contribution and your return. For example (repeat again,
I'm not a lawyer), if you gave your daughter an inordinate amount of
cash for 50% of the equity appreciation, the IRS might say that you
really had given your daughter a gift, and there are tax consequences
if such gifts exceed $10,000 annually.

Another concern: It sounds as if she's already purchased the
condominium. If so, and you now enter into an equity sharing
arrangement, that technically could trigger a "due on sale" clause
because you're now receiving an equitable interest in the property.
Not too likely, but possible.

One thing you might consider is having your daughter set up a land
trust (a so-called "Illinois Land Trust"). She'd be the primary
beneficiary. Then you could be brought in as a second beneficiary. It
wouldn't trigger the due on sale clause...it is good asset protection
in any case...and the other related documents could specify the terms
that you and she agreed to. For more information, see
http://www.landtrust.net. (They're set up primarily for real estate
investors, but it's ideal in your daughter's case as well.)

Hope that helps.

thank you
will study up on land trust
just had 79th birthday
daughter will inherit enough to cover entire price of condo
this is really looking to give her head start on a new setup

You've gotten some good input so far.  However, do consider:

1.  You have a lot to lose at 79, so make sure there is plenty of
insurance...especially liability insurance.  One drunken party and a
car accident could hit your finances hard or wipe you out.

2.  Both names on Deed, possibly with right of survivorship or not. 
You may be able to choose.

3.  Do be careful about when you do this.  For example, if you buy in
after she has already bought it, there will be a sale from her to you
and probably taxes due.

4.  The gift possibility has been mentioned.

You might also enjoy reading "The Millionaire Next Door" if you
haven't read it already.  It has a section on giving financial aid of
sorts to the next generation which I found interesting.

I am also considering helping my daughter with the purchase of a home.
 The big difference here is that I am 56 an I am looking at this as an
investment and I fully intend to realize a pofit.  My concern is if I
have charge her rent.  I will be a 45% owner, so do I need to charge
her rent @ 45% of the going rate?

karenkay-ga,
Try posting a question.  It will have a better chance of being answered.
Myoarin