I am not a OH attorney, laws vary from state to state, therefore you should always consult a local attorney.
You have several options:
1. Deed the home to you now and grant a life estate to your patents;
2. Deed the home to you and your patents as joint tenants with rights of survivorship so that the property automatically becomes yours when your parents pass (note that your parents could still unilaterally convert the ownership to a tenancy in common by conveying their interest to someone else;
3. It is my understanding that OH has TOD Deeds - in which the deed recites that it the property is transferred to a designated person upon the death of the owners. Note that it is my understanding that TOD deeds are revocable - meaning that your parents could change the deed to remove the TOD provision or to give the property to someone else.
Note that anyone of the three choices above would remove the property from probate so that you would not be concerned with when your parents' estate would be finalized. You would be free to sell the property prior to the estate being probated. It is also my understanding that you would not be responsible for capital gains taxes.
I recommend that you speak with a local probate attorney.
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The question is "why are you buying your parents a home?" Presumably it is because you have plenty of money and they have little or none. If that is the case and they need to qualify for Medicaid, owning the house may either cause them to be disqualified or may be recovered by Ohio Medicaid Recovery after they die. My initial reaction is that you should just own the house and let them live there. No papers of any kind. Just buy it and say "Mom and Dad, move in." You will get stuck with capital gains tax if it increases in value and you sell it.
The only other way...and perhaps best way but more information and thought is required...is for you to lend them 100% of the money to buy it, using a balloon note. The term and imputed IRS interest rate will be a function of their age and health, but likely under 2%. When they die, you take back the house. There would be no recovery, or if any, only to the extent that the then-market value exceeds the principal and accrued interest on the note. Have them indicate in the Will that you have first right of refusal to purchase the residence at the date of death value. Of course, you will be purchasing it with your note. There are other considerations so more thought and arithmetic is needed, but this might meet your goals.
Mr. Huddleston is an Ohio-Certified Specialist in Estate Planning, Trust & Probate Law, with offices in Columbus and Dayton, serving client families and private business owners throughout Ohio. He may be contacted directly by phone toll-free at 888.488.7878 or by email CLH@HUDDLAW.COM. Mr. Huddleston responds to Avvo questions as a public service to help educate and provide general guidance to questioners, but his responses are not legal advice and do not create an attorney-client relationship.Ask a similar question
Please feel free to contact me. One of our real estate attorneys should be able to help.
This response does not constitute legal advice and does not create an attorney-client relationship.Ask a similar question
Joint tenancy Rights of survivorship Tenancy in common Inheriting property Real estate documents Real estate buy and sell agreements Real estate quitclaim deed Property deed Real estate Estates Inheritance rights Estate property Rights of survivorship and estate planning Taxes and estate planning Tax law