Legal Question in Tax Law in California

I inherited through a 'life estate' a condo and home in California from my father in February 2008. The condo is worth approx. $120K (definitely more than they paid for it 28 years ago), the home, approximately $300K, more than was paid for it as well. Both properties qualified for 'Reassessment Exclusion for Transfer between Parent & Child'. in their respective counties.

I have no income to speak of other than S.S. of $600 monthly and bank interest. What are the rules & regulations and tax implications (time line) in regard to selling one or both of these properties.

Another question on these properties, what are the issues to bear in keep in mind when you have two residences and live in them 6 months out of the year. This questions has to do with taxes but am not sure what I want to know?.


Asked on 3/24/10, 1:28 pm

1 Answer from Attorneys
Ken Koenen, LLM Law Office of Ken Koenen

If you only have a life estate (whcih may have been done to protect your SS) then you do not have the right to sell the property. There is probably another owner after you leave the residence permanently. If that is the case, the last question may have no bearing on anything because you are not the owner.

In any case, when your father died (assuming he was the only owner of the properties) the basis for tax purposes "stepped-up" to the value at the time of his death. That means that if it was sold today, there would be little or no capital gains tax.

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Answered on 3/29/10, 2:49 pm


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