The smartest thing to do here is to inherit the property after death, via the living trust. Do not create a joint tenancy now. That way you will get the full step up in income tax basis. Plus, as long as you file your form PS-58 within three years of death you will save your mom's prop 13 property tax basis. It's pretty simple and very standard.
Agree with John, assuming that you and your sister are the sole beneficiaries of the trust. Should also get this in writing, in case something should happen to one of you, you would not want your own descendants second-guessing what you and your sister had decided.
John is absolutely right. You do not need to be a joint tenant in order to take advantage of the parent-child property tax exclusion. There are some serious disadvantages to joint tenancy ... if either you or your sister got into financial difficulty, your creditors could seize your interest in the house and force its sale.
If you have any questions about how to accomplish this, I urge you to see a lawyer ... as the old saying goes, don't be penny wise and pound foolish.
The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.
You can protect the tax basis when you inherit real property from your family. Joint tenancy is not necessary , see a lawyer who handles post death administration.
The answers on this discussion board are general in nature and NOT intended as legal advice. Responding to questions does not constitute an attorney-client relationship. Always see a lawyer about your individual situation.