Legal Question in Real Estate Law in California

It makes no real difference. The only difference between a gift deed and a grant deed is that a grant deed contains a recital of consideration, and a gift deed does not, but you could use a grant deed form and recite consideration of love and affection and it effectively becomes a gift deed. What does matter, however, is that intra vivos gifts can have very serious negative tax consequences. Although if you fill out the proper paperwork the property will not be reassessed for Prop. 13 purposes, there will be gift tax due on the equity in the property over $13,000.00. The capital gains tax basis will also jump to the current market value. You should consult with a tax-savy estate planning attorney before transferring the property.