Legal Question in Real Estate Law in California

How to best avoid taxes from sibling to sibling title/deed change

I wish to transfer a property to my sister with incuring as little tax burden as possible (for both my sister and myself). I imagine that I could sell it to her for $1.00, but that would make me vulnerable to gift taxes. How would I best transfer my property to her name and keep the tax burden at a minimum. In a nutshell, is there anyway to avoid gift taxes? There is still a mortgage on the property but she is willing to take it over.


Asked on 12/22/01, 4:58 am

1 Answer from Attorneys
Ken Koenen Koenen & Tokunaga, P.C.

Re: How to best avoid taxes from sibling to sibling title/deed change

What kind of taxes are you trying to avoid?

Capiatal Gains Tax: Is this property primarily used as a rental at this time? How much is owed on the property? Who is currently responsible for the mortgage? Since there is a balance owed, this would be a minimum selling price, if she took over the mortgage.

There are many factors that need to be considered, and it would not appear that gifting the property is the best answer.

Once it is determined what is best, it would be wise to have a formal document drawn up. Better to pay a few dollars in legal fees than thousands in taxes later.

If you would like to email me more details (the more the better), I could give you some guidance.

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Answered on 12/22/01, 12:23 pm


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