How to Transfer Your Home to Your Children the Smart Way

Hi there. My name is Miranda Dressler, an attorney with the MacKay Dressler Law Firm in Petaluma, California. And today we’re going to be talking about a little bit about one of the most common questions we get around property, which is, you know, how can I pass my home to my children without creating tax consequences? Or should I add my child to my deed now? And will that avoid some kind of tax consequence later on down the road?

And the answer is, you really want to be very careful about adding children to the titling of your property now during your lifetime. It may seem like, and it actually can be, a simple process to do that. But it actually, you know, will likely create unintended consequences, both tax-wise, including property tax reassessment issues, loss of step-up in basis at death, which is a capital gains concept. And it also exposes your property to the creditors or potential creditors of your children because they become owners or partial owners of the property.

So in many cases, you know, instead leaving your home through a properly structured trust can preserve important tax benefits and there are just other, you know, details regarding property tax assessment and the rules around that, that it’s really important that you speak with an experienced estate planning attorney about these issues before you just go, you know, have a deed prepared and add a child to a deed. Every family situation is different, and you know, every relationship is different. Your goals, you know, may vary as well. So as I said, talking to an experienced estate planning attorney about this is really important.

So I hope that was some helpful information on the common question of, you know, is it possible to pass a home to kids without creating tax consequences? See you on the next video.

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Miranda Dressler

Miranda has been practicing law since 2009 and has been with our office since 2017. Since graduating from the University of California, Hastings College of Law, she has practiced in both criminal and civil contexts. However, she has found her true passion in working with clients in estate planning, probate, and trust administration. She is frequently a featured speaker for our educational workshops, including Trustee School Read More

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