Posted on: 16th Mar, 2009 03:40 am
hi, i am currently the sole owner of a home in hawaii with an outstanding mortgage. i would like to split my interest in the home with my aunt. i plan to refinance with her so we will both be on the new loan. is a quit claim deed my best option for adding her to the title? can i quit claim only a portion of the interest and retain the remainder? will i be responsible for gift tax on the value of the portion i deed to her?
Hi Sean,
A quitclaim deed would surely be a good option to add your aunt to the title. Through the deed you can quitclaim the property, either in full or in part. You need to sign the deed as grator transferring a certain portion of the property to the grantee i.e. your aunt. This way you can own the remainder of the property-interest. Yes, you will be resonsible for gift tax for the value of the portion you sign over to her. But there are certain gift tax exemption which you can avail of.
A quitclaim deed would surely be a good option to add your aunt to the title. Through the deed you can quitclaim the property, either in full or in part. You need to sign the deed as grator transferring a certain portion of the property to the grantee i.e. your aunt. This way you can own the remainder of the property-interest. Yes, you will be resonsible for gift tax for the value of the portion you sign over to her. But there are certain gift tax exemption which you can avail of.
Thank you for info. The gift tax exemption should help but is there any other way to avoid the gift tax altogether. Would a warranty deed by a better option?
Hi Sean,
A warranty deed cannot help you save taxes. It is effective in transferring a property free and clear of any claims and liens. In comparison a quitclaim deed comes with no gurantee whether there is any claim or lien on the property. From this point of view, a warranty deed is bettter. But taxwise, there is hardly any difference between the two deeds.
A warranty deed cannot help you save taxes. It is effective in transferring a property free and clear of any claims and liens. In comparison a quitclaim deed comes with no gurantee whether there is any claim or lien on the property. From this point of view, a warranty deed is bettter. But taxwise, there is hardly any difference between the two deeds.