Posted on: 08th Feb, 2010 08:49 am
my father-in-law wanted to avoid estate taxes so he and my mother-in-law quit claimed their lake home to all their children with a stipulation that they can possess as long as they are alive. also, in this deed they said the grantor will continue to pay the real estate taxes. my father-in-law recently passed away but my mother-in-law is still alive.
will this quit claim deed protect it from estate taxes when my mother-in-law passes? will it protect the property from being used up if my mother-in-law has to go to a state run nursing home?
what about gift tax?
considering there is now a $3,500,000 exclusion before estate tax, would have it been better to leave it in the estate since the entire estate will probably only be about $1,500,000?
if it had been left in the estate, would the children need to pay capital gains if they sell it?
will this quit claim deed protect it from estate taxes when my mother-in-law passes? will it protect the property from being used up if my mother-in-law has to go to a state run nursing home?
what about gift tax?
considering there is now a $3,500,000 exclusion before estate tax, would have it been better to leave it in the estate since the entire estate will probably only be about $1,500,000?
if it had been left in the estate, would the children need to pay capital gains if they sell it?
Hi,
I think the estate will be subject to estate taxes if your mother-in-law passes away. She has life estate rights to the property and she can occupy the property as long as she's alive. But when she no longer occupies the property, the heirs will be responsible for the taxes on the property. Your mother-in-law will have the life estate rights, even if she goes to a nursing home, as long as she expresses her intentions to return to the property.
As far as the gift tax is concerned, there are exemptions available. There's an annual gift tax exemption of $13,000 and a lifetime gift tax exemption of $1 million which one can avail of.
I think the estate will be subject to estate taxes if your mother-in-law passes away. She has life estate rights to the property and she can occupy the property as long as she's alive. But when she no longer occupies the property, the heirs will be responsible for the taxes on the property. Your mother-in-law will have the life estate rights, even if she goes to a nursing home, as long as she expresses her intentions to return to the property.
As far as the gift tax is concerned, there are exemptions available. There's an annual gift tax exemption of $13,000 and a lifetime gift tax exemption of $1 million which one can avail of.