Legal Question in Real Estate Law in California

Re: Prop 13-Transfer to niece

Parent-child, child-parent, and in some cases grandparent-grandchild transfers are exempt from reassessment, and there is a handful of other exemptions, none of which would apply to an aunt-to-niece transfer. Furthermore, transfers below market value trigger the gift tax, and do not produce a step-up in cost basis for the eventual calculation of capital gains. This causes an unnecessary and aviodable double tax bite. The aunt may want to sell the property and the niece may want to but it at full market value if the aunt needs cash, but if the purpose is to make a nice gift to the niece, 99% of the time the very much better way to accomplish this is to arrange that the niece will inherit the property by will or, even better because it avoids probate, by living trust. Attorneys usually advise against making a gift of appreciated property during the older person's lifetime, and against making the younger person a joint tenant.

Re: Prop 13-Transfer to niece

No. But the transfer should not occur during the life of the Aunt. There are huge taxe disadvantages to giving the property before death. I suggest you go to my website, www.IWant2CreateMyLegacy.com and download the free special report about the msot common mistakes made by people is preparing for the inevitability of death and the likelihood of illness. It will explain in more detail but in layman's terms.