Property deed question...

[KFC911]

Originally Posted by cabmandone

I always say, Why do today what you can put off until tomorrow? That's how my dad's car ended up in probate.

"NEVER do today, what you can put off until tomorrow" - Me

Words to die by

Mom will be the proud co-owner of a POS F150 with 215K miles

I'll not put that off ... saves a bundle on HO insurance ... a good daily driver too... nothing works

[flatbutt]

Why not an irrevocable property trust?

[greglepore]

If the real estate is the primary significant asset, the deed he originally suggested is more simple-no need for an ein and tax return, k1's etc. If there are other substantial assets, yeah...

[KFC911]

Thank you all ... Do high priced attys accept beer as payment?

I KNOW Nick will !

I just might do the CC deed thing ... because I learned something handling my aunt's estate a year or so back. Or I might just put it off until tomorrow ... or Tuesday ... like Wimpy

[berettafan]

You have multiple factors to consider-
1- inherited step up basis goes away if you add your name to deed. At least for your portion of the property.
2- what sleazy attorneys euphemistically call 'medicaid planning' doesn't appear to be considered here.

You NEED to understand the implications of BOTH before putting your name on anything beyond a checking and savings account.

[KFC911]

Originally Posted by berettafan

You have multiple factors to consider-
1- inherited step up basis goes away if you add your name to deed. At least for your portion of the property.
2- what sleazy attorneys euphemistically call 'medicaid planning' doesn't appear to be considered here.

You NEED to understand the implications of BOTH before putting your name on anything beyond a checking and savings account.

The first ... doesn't matter one iota. "I" want total control, and do not want a spouse (of an heir) to have ANY say-so ... whatsoever ... none.

All vested parties do "get it" ....and why .

They are almost 90, dad has been on borrowed time for a while.

Most docs, etc. were done decades ago ... attys (outside of this board) have been no help ... not worth even a beer .

Thanks!

[john70t]

Originally Posted by berettafan

You have multiple factors to consider-
1- inherited step up basis goes away if you add your name to deed. At least for your portion of the property.

Good point. details details

A) Would KC like to spend a few bucks on a loyerer now for planning? Avoiding future probate costs altogether and a whole bunch of extra time spent fuming while big bills are due, but the money is in flux into the unforeseeable future, meanwhile making a powerful friend?

B) Or would he like to absolutely pay more of that money to the gubmint at later time of sale in capital gains, from when the parents bought it back in the 1950s. Because you know any assessor will look and see a gold-plated box.


fwiw- Now is a good time to good time to get POA. Every entity will want that authorization plus a Death Certificate from the county clerk. Get a dozen stamped. Go through photographs together and film their memories. For them. For you and yours. Who is that in the picture? Family trees. Whatever they want to say. Get lists of people to contact for memorials etc. Make a list of major assets and what is their wishes. Figure out accounts so no bill collectors send big letters of garnishment five years from now. Lists. Lists. Lists. A sheet for each type. Also look into Hospice. They can provide everything and know what they are doing.

So much work to do at the worse time. Keep your sanity and make it a smooth transition.

[KFC911]

John you are making assumptions I am quite comfortable with what has been done over the past 25 years, and what currently "is in effect" for my parents me, my family, etc. but it's probably not perfect.

I am a novice, but just did the executor part (for dad's sister) about a year ago here in NC.... I did learn somethimg new during that process.

I have talked to at least 6 attys over the past 13 years ...

I wish I had been buying Greg beers instead all those years too... or hay for his horses !

It's been a journey ... I've learned a thing or two... and appreciate every single one of you guys with experience also who post. Seriously appreciate the PPOT braintrust too ... better than one other trust from way back ... by a trusted atty & financial advisors... but I digress... I fired them .

Thanks!

[greglepore]

Originally Posted by berettafan

You have multiple factors to consider-
1- inherited step up basis goes away if you add your name to deed. At least for your portion of the property.
2- what sleazy attorneys euphemistically call 'medicaid planning' doesn't appear to be considered here.

You NEED to understand the implications of BOTH before putting your name on anything beyond a checking and savings account.

As to the basis step up, not that simple. If the joint interest was gifted, you still get the step up. https://www.linkedin.com/pulse/understanding-joint-tenancy-tax-griffin-bridgers/
But there are complications, none of which LIKELY apply to KFC's case. First, for estate tax purposes its all still in the decedents estate (but there's a 27 million tax exemption for couples currently). Second, its complicated as to investment property and depreciation, but this is the family home.
And yeah, this isn't a Medicare dodge.

[greglepore]

Originally Posted by KFC911

John you are making assumptions I am quite comfortable with what has been done over the past 25 years, and what currently "is in effect" for my parents me, my family, etc. but it's probably not perfect.

I am a novice, but just did the executor part (for dad's sister) about a year ago here in NC.... I did learn somethimg new during that process.

I have talked to at least 6 attys over the past 13 years ...

I wish I had been buying Greg beers instead all those years too... or hay for his horses !

It's been a journey ... I've learned a thing or two... and appreciate every single one of you guys with experience also who post. Seriously appreciate the PPOT braintrust too ... better than one other trust from way back ... by a trusted atty & financial advisors... but I digress... I fired them .

Thanks!

Prefer bourbon, but alfalfa works.

[berettafan]

Originally Posted by greglepore

As to the basis step up, not that simple. If the joint interest was gifted, you still get the step up. https://www.linkedin.com/pulse/understanding-joint-tenancy-tax-griffin-bridgers/
But there are complications, none of which LIKELY apply to KFC's case. First, for estate tax purposes its all still in the decedents estate (but there's a 27 million tax exemption for couples currently). Second, its complicated as to investment property and depreciation, but this is the family home.
And yeah, this isn't a Medicare dodge.

Greg how does this part make sense?
If the child immediately turned around and sold the property for its gross estate value, they would only have to pay tax on the appreciation in value of their 50% ownership (including recaptured depreciation on their 50%).

'immediately turned around and sold' implies no gain as it is sold at death. Only recapture would be picked up. So where is the tax on 'appreciation in value'? Or is this just poorly written?

Also, if the parent includes the half previously gifted in their gross estate how is that not double counting it as presumably a gift tax return would have been filed already reducing the estate? ie single parent, 300k home, adds child so 150k gift. parent dies, estate should be 150k however link says 300k is gross estate; YET exemption is already reduced by 150k. I realize these figures don't touch the estate exemption but the theory should apply.

PS- this is why I don't do estate work! And probably why I have a terrible time finding quality cpa's to refer it to!

[greglepore]

Originally Posted by berettafan

Greg how does this part make sense?
If the child immediately turned around and sold the property for its gross estate value, they would only have to pay tax on the appreciation in value of their 50% ownership (including recaptured depreciation on their 50%).

'immediately turned around and sold' implies no gain as it is sold at death. Only recapture would be picked up. So where is the tax on 'appreciation in value'? Or is this just poorly written?

Also, if the parent includes the half previously gifted in their gross estate how is that not double counting it as presumably a gift tax return would have been filed already reducing the estate? ie single parent, 300k home, adds child so 150k gift. parent dies, estate should be 150k however link says 300k is gross estate; YET exemption is already reduced by 150k. I realize these figures don't touch the estate exemption but the theory should apply.

PS- this is why I don't do estate work! And probably why I have a terrible time finding quality cpa's to refer it to!

As to the first, its somewhat poorly written. There would be gain to the extent of recaptured depreciation, depending on how the numbers crunched.
As to the double dipping, yeah. Its not a problem for the vast majority of us, but assuming you played by the rules and filed the gift tax return, the joint interest conveyed gets counted twice against the exclusion according to that brief blurb. It may be that there's a ruling or reg that offsets this, I'm not that deep into the weeds to know at this point.

[john70t]

Originally Posted by KFC911

John you are making assumptions I am quite comfortable with what has been done over the past 25 years, and what currently "is in effect" for my parents me, my family, etc. but it's probably not perfect.

Good of you.
I usually fall on the side of giving too much information and possibilities. And maybe some is probably not applicable/solicited/correct in unknowns.
Nothing bad intended.

[KFC911]

^^^ No problemo John, I've learned a lot from your posts over the years and appreciate them!

Just flapping my wings and flying like a turkey ... I use Pelicans for navigation too.

Do you like alfalfa?

I'm running a "Tabs" here !

[cabmandone]

Originally Posted by greglepore

Prefer bourbon, but alfalfa works.

KFC, that'll be one bottle of Woodford Double Double Oaked, and whatever Greg is having. I got no use for the alfalfa...