My parents are over 74+ years of age, and they want to put me on title of their property. Is this a good idea, or should I just be on the will? How will it affect Tax ET. (in California)
If it makes a difference, I do own real estate in California, and live in Ca.
2007-06-18 07:39:23 · 5 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
It will save you on inheritance tax, since on paper you already are part owner. Thank your parents
2007-06-18 07:42:39 · answer #1 · answered by Pengy 7 · 0⤊ 1⤋
Never take anyone's answer here for gosel. However let me suggest a couple things.
If they deed you an interest in there home it will affect you tax wise. If you inherit it you get it at the stepped up value at that time. Where as if they give it to you you have -0- in it so everything is taxable. Probably should form a trust and make it that on there death it transfers to you. But not knowing your income and other assets and there situation You should really all go into your tax persons office or get reputable tax help on this. A few hundred dollars spent getting this serious question answered could save you and them Thousands in the end.
2007-06-18 15:23:15 · answer #2 · answered by Scott 6 · 0⤊ 0⤋
Are you an only child? If so this does make some sense for them. If they put you on title, in joint tenancy with them, then when they die you inherit without all the tax issues. Or they could deed the property to you outright, and retain a life estate (which means, you own it, but they have the right to live there for as long as they live.) You and your parents need to see a lawyer, explain what they are wanting and have him prepare the deed. You don't want any problem showing up after someone has died.
2007-06-18 15:16:17 · answer #3 · answered by Kathleen M 4 · 0⤊ 0⤋
It's probably actually a very bad idea.
When they die, you'll inherit the property at it's "stepped up" value. Meaning, the value as of the day they die. All capital gains they earned vanish.
If you're put in title now, you'll be taxed at full capital gains rates.
Farming families used to do this and screwed themselves. Kids could've inherited the land clear, instead had to finance a ton of money just to pay taxes.
You really need to hire an estate planning/tax attorney or other type of CPA. It might cost a few hundred, maybe a grand or two. But I guarantee you'll save thousands more in taxes by doing it right.
2007-06-18 15:32:03 · answer #4 · answered by Yanswersmonitorsarenazis 5 · 0⤊ 0⤋
If your parents are in good health and are looking to protect their assets, see a trust attorney who will set up a trust that will own the house and other assets. The trustee, who can be you or anyone else they desire, will operate the trust according to what's written in the will. If you do this, any will needs to be rewritten.
2007-06-18 14:44:37 · answer #5 · answered by Anonymous · 0⤊ 0⤋