Tax involved with taking mother's name off from deed

You may have missed a step so I add it just in case you forgot it. First step is to record a Notice of Death of Joint Tenant that will make your mother the sole owner of the property. The second step, should our mother choose to do so, is to record a deed conveying the property from her name to you and her. There is an exemption for transfers between parent and child, in California, that exempts you from transfer taxes or reappraisal for tax purposes. When you record the new deed, you will have to include an Assessor/Recorders form that requests the expemption and signed by you and your mother. I am fuzzy on the form but I believe it is Prop 85 exemption also called transfer between parent and child. I hope this helps

Actually, I disagree somewhat with Mr. Weinstein. If you file a quitclaim deed, the county (and/or the city where the property is located) may very well charge transfer taxes (usually $1.10 per $1,000 of value - but more in some cities). If you file a gift deed, on the other hand, and you meet certain other requirements, then there is no transfer tax. You can retain your mother's property taxes by filing a "Parent-Child Exclusion" form a/k/a Prop. 58 form. As for tax implications, you may be responsible for capital gains taxes when the property is (eventually) sold. Depending on the value of the property and the other gifts your mother has made, there may also be gift taxes or estate taxes. You need to consult with a knowledgeable estate planning or tax attorney. Given the value of most real estate in Santa Clara County, you're foolish not to spend a few hundred dollars to make sure that things have been handled correctly.

I agree with Ms. Brewer. As for the gift taxes, mom's gift to you of one half of the property will require the filing of a Form 709, US Gift Tax Return, for your mom, since it assumed that the value of the house is greater than $26,000. However, there is a lifetime gift tax exemption of $5 so there would probably be no gift tax to be paid. From an income tax perspective, you would take a carryover basis (what was paid plus improvements) on the house, resulting in probably a very low basis. If you were to sell this house, there would be capital gains tax. However, if you intend to live there and it is your primary residence, you may be able to exclude the first $250,000 of capital gains if you meet the tests for this exclusion. Hope this helps. Mr. Fromm is licensed to practice law throughout the state of PA with offices in Philadelphia and Montgomery counties. He is authorized to handle IRS matters throughout the United States. His phone number is 215-735-2336 or his email address is [email protected] . For further tax advice visit his website at www.sjfpc.com . and blog at >

To further clarify the prior responses, there is a transfer tax in California though you are likely exempt under the parent-child exemption. This may be declared initially by filing a Preliminary Change of Ownership form (PCOR) with the deed, thereby alerting the county assessor of the exemption claimed. The exposure to gift tax (payable by your mother) and inheritance tax (not relevent here because she has not yet passed) is mitigated by your respective lifetime exemptions. Speak to a competent tax preparer to get more detail regarding the need for a gift tax return. Hope this helped.