Is it possible to transfer real property held in joint tenancy into a living Trust?
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Is it possible to transfer real property held in joint tenancy into a living Trust?
If so, will this affect the WROS?
Asked on July 25, 2015 under Estate Planning, California
Answers:
M.H., Member, California Bar / M.H., Member, California Bar
Answered 9 years ago | Contributor
Yes, it's possible to transfer joint tenancy properties to a living trust.
joint tenancy property only receives a half-stepped up basis for tax purposes. Whereas, property held as community property or community property with right of survivorship recieves a double stepped-up in basis. Meaning, the surviving spouse could be subject to adverse capital gains tax if the property is held in joint tenancy, or no or little capital gains tax if the property is held as community property.
Most real properties are held in trust as opposed to joint tenancy. Joint tenancy can be problematic if you and the other joint tenant are rendered incapacitated or both or all die at the same time. Joint tenancy ownership will not address these problems, but your trust probably will.
I hope I answered your question.
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