Our son built a small home on our property. It carries the same address as ours. How do we set up the best way for him to inherit ownership of full property after we pass away? We currently have a spousal joint ownership. What are his/our tax benefits in this situation vs his joining the ownership of home now?
Should this be done with survival of one of us still living? If surviving spouse needs nursing or home care at one point, how does this affect ownership of the property when he will then be the POE?
the other alternative which is easy is to put the home in joint tenancy with the three of you but nursing home can take your share .
I live in an area where ADU's or recreation buildings can be built on the same land as the main home, especially for immediate family. My son has been able to do this for a comfortable living area. All legal permits have been made, so this isn't the issue for the home itself.
I have decided to contact a lawyer though, that seems the smartest way to make sure everything is in order. I wanted to know more information about the process before going to see someone. It can be confusing when there are multiple ways of doing this.
Thank you again for taking the time! This site is invaluable.
2. You might want to call the local community offices and speak with someone in the Assessor's office, or Platting office (if there is one). Depending on community regulations, there might be a possibility of severing his lot by assigning it a separate legal description, lot number and/or plat no. But that would have to be done through the community governmental offices.
3. You might also have to have your own lot replatted as it will be severed from your son's portion. The Treasurer's Office would be notified, with the new lot number and Sidwell (property identification).
4. Then, once you have a legal description for your property only (and your son has a description for his property), you can have a real estate or elder law attorney create a new deed for you and your husband's property and (a) add your son's name with survivorship rights. There might be better ways to do this, which a good attorney with background in estate planning (specifically trust and wills) as well as real estate. This could be a tricky situation, depending on the community and its regulations.
5. This is a supposition; I have some limited knowledge of parcel separation, but I believe it varies by county. If by chance you live in a rural area and the lot description is metes and bounds, you might have to deed his lot to him outright.
If the last sentence is applicable, another issue could come into play: access. From my experience with parceled up metes and bounds property, jurisdictions typically require newly platted or metes & bounds parcels to have ingress and egress access. The new area can't be w/o that. This is something a real estate attorney should research and advise.
6. I don't have enough experience in tax law to offer any suggestions on your son's tax benefit now or as a participant in joint ownership. I am surprised though that the community didn't require some type of severance, or permission, for his house to be built.
7. I would get this done now, but definitely hire legal help to address the questions in your last paragraph. This is too complicated to be answered on a forum; you need real pros practicing in this area. We can offer suggestions on issues but you certainly should not rely on advice gained from an Internet forum, other than following up with qualified professionals. (And, I'm not sure what a POE is, or did you mean proxy under a DPOA or POA?)
If in a rural area the legal description may be a lot number within the subdivision. In my area, metes and bounds are only available if a parcel is larger than 35 acres.
Do it now, not when only one of you is still alive. That one left behind could conceivably not be competent to create a trust. You just never know what can happen.
Say she paid $45,000 for her house fifty years ago, and it's worth $200,000 when her kids want to sell after her death. They'll pay taxes on the $155,000 profit, because they assumed her cost basis of $45,000 when she signed it over. If they'd inherited it, their cost basis would be the value of the house the day she dies, and any tax they pay would be on the difference between that amount and the sale price. If they sell not long after her death, the tax would !e minimal, if any.