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Martin Silver’s Answers

1 total

  • Parents own home but want to sign the title of the home over to one of their children, will taxes be charged on the property?

    Martin’s Answer

    If the mortgages are completely paid off, and if the child gives the parents no consideration on taking title to the home, there is no real estate excise tax (REET) on the house. If those two conditions exist, then the transfer of title is a gift for which there is an exemption from REET. However, if the parents by virtue of their age and economic status are getting a break on annual property taxes, that benefit will likely be lost if the transfer is made. Moreover, transfer of property to a child exposes it to the child’s creditors, so it is imperative that the child be financial sound and responsible. Overall, I view these as risky transactions which should not lightly be undertaken.