Quote:
Originally Posted by Yvonnebang
Joseppe, can you elaborate on your point about how it "depends on a number of factors"? If it was a gift (the house deed name changed to your child's) While you were alive, then it would be capital gain exempt when the child decides to sell, right?
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When a gift is received such as stock or a house the beneficiary retains the basis the donor has - no step in basis.
Quit claim is gift so no step up in basis. Upon death the beneficiary would have gotten a step up for the portion the deceased had.
How the property is titled is critical both for taxes and estate. A mother and son own a house - Jane Doe and John Doe. The son passes away. The son's share of the house does not automatically go the mother because it was not titled "Joint Tenants Right of Survivorship". Since the son had no children his half of the house went to his mother and his father who was divorced by the son's mother. Now the mother owns 75% of the house and the divorced father owns 25%. The father was a good guy and gave up his 1/4 to the mother. Could be a lot worse because the title lawyer screwed up. Father could have retained 25% of the house the mother lived in - and would have received 25% of the proceeds when the house is sold.
Different tax results owning a house together instead in JTROS.
Check the title of all property now to make sure it is correctly titled. Both the property you own and your relatives!
