Posted by John Merchant on February 10, 2006 at 16:57:18:
Sorry, but tax lawyer I"m not, so he should consult with a tax lawyer (or his regular accountant probably) for reliable answer.
I do know that if he kept until death, the kids’ basis would be the value then…but that saving would be offset somewhat by the cost of probating his will.
Avoiding probate question - Posted by Bob H
Posted by Bob H on February 01, 2006 at 14:56:47:
My father-in-law would like his residence in Florida to transfer to his 3 adult
children upon his death. The property has approximately 200K equity, and his
other assets total less than 50K.
Is there a preferred method to hold title now, (other than joint tenancy) that will
allow the property to pass to his children upon his passing, and avoid having to
go through probate.
Thanks in advance for any advice!
Bob H
Re: Avoiding probate question - Posted by dealmaker
Posted by dealmaker on February 01, 2006 at 16:53:18:
The real question is WHY does he want to avoid probate? AFAIK FL is one of the easiest states in which to probate a small estate.
By keeping it in his own name there would be NO ESTATE taxes upon a transfer at death, he would be able to maintain his current (probably low) RE tax appraisal and he would be able to maintain his current (I’m supposing) old age exemption.
Everyone has this huge fear about probate, in most states it’s pretty simple and cheap, particularly on an estate this size.
Just my opinion.
dealmaker
Re: Avoiding probate question - Posted by John Merchant
Posted by John Merchant on February 01, 2006 at 15:34:07:
The simplest and quickest would be for him to deed the RE to the kids now, reserving a life estate (in the deed itself would be this reservation language), to himself.
This way, the RE is his kids now, so they’ll owe the property taxes on it, but he’ll have the guaranteed right to live there and use the residence until he dies.
Any lawyer who knows anything about RE in FL can do such a deed quickly.
That property wouid not be included in any probate, if a probate is otherwise necessary, as it’d no longer be an asset of his.
Re: Avoiding probate question - Posted by Natalie-VA
Posted by Natalie-VA on February 10, 2006 at 16:16:16:
John,
What effect would this have on their basis for tax purposes? I know normally, if he gifts it to them, they will get his low basis which might not be desirable to them later. Does the fact that he retains a life estate change this?
Thanks.
–Natalie