Transferring the House
My inlaws want to transfer the house to their kids. Is this something simple to do with a lawyer? Does any of the parties have to pay tax for this transaction? If yes, any other methods that can avoid it?
My inlaws want to transfer the house to their kids. Is this something simple to do with a lawyer? Does any of the parties have to pay tax for this transaction? If yes, any other methods that can avoid it?
Yes, yes, and yes to the above.
Also,
if the home is sold/removed from the estate to avoid nursing home expenses please consider checking that the timeframe is correct… or be prepared for the home to be seized and it’s valuation adjusted to cover extended care cost(s).
Of course, that would never be a reason for property transfer–
Just sayin’ —
You could avoid serious taxation by waiting to transfer the property after death. I’m assuming the home was purchased a while back? If so, the children would receive a stepped up tax basis upon the parents death (Saving income taxes for the children upon a sale of the property). Estate taxes would still likely need to be paid, however, a transfer before death is rarely a good idea unless there are other circumstances not described here. As a real estate attorney, I would recommend leaving the home to the desired party in a will. If you want them to live there now, just let them live there now and then will the home to them upon death.
You could avoid serious taxation by waiting to transfer the property after death. I’m assuming the home was purchased a while back? If so, the children would receive a stepped up tax basis upon the parents death (Saving income taxes for the children upon a sale of the property). Estate taxes would still likely need to be paid, however, a transfer before death is rarely a good idea unless there are other circumstances not described here. As a real estate attorney, I would recommend leaving the home to the desired party in a will. If you want them to live there now, just let them live there now and then will the home to them upon death.
Give a call to Jeffrey H Leavitt 516-594-0222.
Tell him Vanessa sent you.
He is a realestate attorney and will give you the advise you need.
Hello! Yes this is subject to taxation. You need an estate attorney.
I am not a tax or estate lawyer or accountant, but I don’t see how a transfer of a house in New York City would not involve some type of questions regarding gift tax.
It might be better to sell them the house, carry the note themselves at the IRS AFR rate, and then determine if they can forgive part of the purchase price within the gift tax annual exemptions. These are very tricky planning issues and IMO require expert advice, not that of an anonymous poster on the internet.
As for transfer tax issues, I am not sure if an inter-family transfer triggers any tax or not.