Will my child have to pay a death tax if I put his name on my house deed and I die?
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Will my child have to pay a death tax if I put his name on my house deed and I die?
My father refuses to make a living trust and instead wants to add me to his deeds, I’ve been under the impression from another lawyer that I will be taxed greatly this way if he dies or “sells” me the house for $1.
Asked on March 27, 2012 under Estate Planning, Alabama
Answers:
Steven Fromm / Steven J Fromm & Associates, P.C.
Answered 12 years ago | Contributor
Big, big mistake. Your dad's stubborness will cost you dearly. He should not, I repeat not transfer these properties during his life. If he simply provides for you in the will, the basis of the property will be stepped up to the date of death values. This will almost eliminate any capital gain tax. For more on this topic and the need to file a gift tax return under your scenario please read the following hypertext article: http://www.sjfpc.com/irs_auditing_real_estate_gifts_tax_rules_returns_form_709.html
M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
Why don't you go and seek help from an estate planner who can look at all the assets and see what's what. Generlly speaking, if your Father ads you to the deed with "rights of survivorship" the proeprty will pass to you automatically upon his death. The tax issue comes when you pass away or sell. I wouldn't do the dollar thing. Good luck.
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