Your Mother if competent when she made the arrangement is free to do what she wants with her estate. Your Brother who is happy to sit on the side lines and let his brother do all the ugly work and then sweep in a claim is "fair share" will lose unless he can prove undue influence or fraud. You should raise this with your Mom now so she can take steps to preserve her capacity and her wishes. She can say "in return for caring for us" I leave everything to Z. It is my wish that X and Y do not take anything". That will rule the day.
Technically, your brother can still try to sue and if he has the money, an attorney may take a shot at it but based on the little you have stated, will not likely prevail. As to inheritance tax, there is none in California. If you mean estate tax, the limit is up to $5M so that would not apply either. It is a mistake to have put everything in his name from a basis perspective; basis is what you paid for something roughly and is used as a measure against what you sell something for to measure gain. What that means is on her death, the property when transferred to him would otherwise have a step up in the basis to FMV so that if he sold it on her death, he would have no capital gain. If it transferred as a gift, then his basis is what hers was and on sale, he will have huge capital gains. There are, however, valid reasons to do life time transfers and this situation may be one.
Finally, be clear, none of you is entitled to a "fair share". She can leave all to a church if she wants to. Because you are a child of hers does not mean she is obligated to leave you each 1/3 so he needs to readjust his thinking on this. If you think that it is fair and Mom is of clear mind, help your brother and her out by supporting that. Her attorney can make notes and take steps to preserve her wishes. Be glad it is not you in his position because money is not everything and he is probably miserable.
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This is an extremely tricky question. If we assume that your parents/mother are lucid (they have capacity) she could give everything away to charity before she dies and there would normally be no consequences. Issues could arise if there was proof your brother abused a power of attorney or coerced such behavior. Generally, courts are more apt to look at pre-death transfers than they used to be but generally speaking what you do with your property while you are alive is your business. I would not some issues however - your mother/father apparently have gifted to your brother a great deal of assets which would require they file and pay gift tax. Also, your brother has now acquired property with no "step up" in basis so if he sells property he has acquired (real estate, stocks) he will have significant income tax consequences. There may be a lawyer who would take the case and make a claim but I think success would be unlikely based on the limited facts given.
There are two ways (at least) to consider your mother's transfer of her assets to your brother. The transfer can be considered a contract between your parents and your brother in which they have given him their assets in exchange for his agreeing to provide care when they enter their "old age." If your brother has provided the proper care then your other brother does not have reasonable cause to challenge the transfer. The second view of the transfer is as a gift. If your parents were competent and in agreement, they could transfer their assets to a child as a gift. Without knowing more about the circumstances, I cannot think of grounds for your brother to challenge the gift.
The transfer of your parents assets are not an "inheritance" to be challenged as the assets were transferred long before death.
However, the legal system allows anyone to file a complaint for a perceived civil wrong so I cannot tell you that your brother won't file a complaint.
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