Legal Question in Tax Law in New Jersey

Re: Transferring home ownership to son

Not immediately, but potentially down the road. Presuming your parents have not exhausted it yet, they both have their lifetime gift exclusion of 1MM, so no gift tax should be incurred, but the transfer will be considered a gift. Their cost basis will become your cost basis, while the gift is valued at current market value. This differential could result in capital gain when the house is ultimately sold, unless at the time of sale it is your primary residence and the current exclusion remains in effect. Two suggestions: (1) your parents retain a life estate, spelling out what bills they will continue to be responsible to pay. This all should be in the new Deed and assures them the house cannot be sold while they live there. (2) All of you might want to consider putting the title, or at least their share, in a trust so it does not become part of your estate when you die. This could possibly save NJ death taxes. If you have any questions or need assistance contact me directly.

Re: Transferring home ownership to son

I answered this question, but it might not have posted. My answer is available by looking for me at this site and checking the latest answer I gave under taxation. My answerr was too long to repeat again.