Real Estate help please-home deed transfer process

[sundevil777 102]

I hope someone out there is knowledgeable about my situation and can help.

I already have my father's house set up so that I have ownership upon his death, previously set up and filed that paperwork with a lawyer's help years ago.

What we want to do now is to actually take my father's name off the deed completely, and have it in my name only. The house is in Arizona, and is completely paid off, perhaps that makes a difference in the process.

My thought is that there should be some process besides a formal "sale" of the house that keeps the costs/fees down. I figure that I might need a lawyer to do it, but perhaps not? I'd rather not pay for a lawyer's consultation for something I can do myself with the right forms.

Thanks for your help.

People are sick and tired of being told that ordinary and decent people are fed up in this country with being sick and tired. I’m certainly not, and I’m sick and tired of being told that I am

[airdvr 210]

I thiik what you're looking for is called a "quit claim". I'm sure someone in the industry will be along shortly to give you more insight.

Please don't dent the planet.

Destinations by Roxanne

[squirrel 0]

careful, careful. ok, not sure on the AZ tax rules, but...i have been told it is better to inheiret the house, rather than quit claim. reason being that the quit claim process opens you up for taxes on the "increase in equity" or value of the house. you are only allowed to gift someone $10,000 per year tax free, and the value of the house, i am guessing exceeds that. talk to a gooood CPA first, and then talk to another one, and even a third, before you make a move. check out http://www.daveramsey.com/elp/home/ he has a list of endorsed local providers....we have used several for medical insurance and other items and have had great success.

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Where is Darwin when you need him?

[squirrel 0]

did a quick search, and this seems to match your case...read carefully about the tax implications of quit claim vs. inheriting the house.

http://answers.google.com/answers/threadview/id/783778.html

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Where is Darwin when you need him?

[squirrel 0]

essentially, through a quit claim, you will assume all the equity growth tax liabilities, if you ever sell the house, that the house gained while your father owned it. for example, my parents paid $9000 for their house in 1954, they are now 85, house paid off and will leave it to kids upon death. the house is now worth 1.5 million. if they were to quit claim it to any family member, when that family member sells the house, taxes will me collected on 1.5 million - $9000. holy shit. yes, i know. but, each spouse can pass on i believe 3.5 million via wills and trusts, tax free...with the right paper work in place. and, lets say i take possesion of the house via a death will, my tax liability for the house if i were to sell is base on current market value and time of transfer and sales price....as in 1.5 million current value. i sell for 1.6 million....taxes would be on $100,000 only. talk to a local CPA, a good one.

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Where is Darwin when you need him?

[sundevil777 102]

Thanks for the advice. I want to avoid a situation where he might need nursing home type care, but medicare takes his assets (his house is his only asset) to pay for it. I see now there are other considerations.

Thanks again.

People are sick and tired of being told that ordinary and decent people are fed up in this country with being sick and tired. I’m certainly not, and I’m sick and tired of being told that I am

[squirrel 0]

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Thanks for the advice. I want to avoid a situation where he might need nursing home type care, but medicare takes his assets (his house is his only asset) to pay for it. I see now there are other considerations.

Thanks again.

i see. if you do quit claim, gotta be carefull on when you do it...as in, if he has debts, it could be considered fraud. email some one on Dave Ramsey's web site...he is really up on this stuff. my parents bought "long term health care" insurance to supliment there other insurance and medicare...then the bastards delcared chapter 7. I would talk to many people (experts) before i make a move. good luck.

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Where is Darwin when you need him?

[DrewEckhardt 0]

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careful, careful. ok, not sure on the AZ tax rules, but...i have been told it is better to inheiret the house, rather than quit claim. reason being that the quit claim process opens you up for taxes on the "increase in equity" or value of the house. you are only allowed to gift someone $10,000 per year tax free

The gift tax has a $1,000,000 lifetime exemption. If your father has a small estate this will not be an issue.

Medicaid generally requires people to exhaust their assets before getting coverage for a nursing home. Home equity is exempt up to $500K in some situations. However they look over the last five years for gifts and sales below fair market value, and deny coverage until you would have spent that money. You could have the situation where if your father keeps his house and ends up in a home he's covered, but he'll have problems if he gives the house away.

Talking to a CPA or eldercare/estate planning attorney might be a good idea.

[sundevil777 102]

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careful, careful. ok, not sure on the AZ tax rules, but...i have been told it is better to inheiret the house, rather than quit claim. reason being that the quit claim process opens you up for taxes on the "increase in equity" or value of the house. you are only allowed to gift someone $10,000 per year tax free

The gift tax has a $1,000,000 lifetime exemption. If your father has a small estate this will not be an issue.

Medicare generally requires people to exhaust their assets before getting coverage for a nursing home. Home equity is exempt up to $500K. However they look over the last five years for gifts and sales below fair market value, and deny coverage until you would have spent that money. You could have the situation where if your father keeps his house and ends up in a home he's covered, but he'll have problems if he gives the house away.

Talking to a CPA or eldercare/estate planning attorney might be a good idea.

Thanks, I'll have to look into the <500k medicare exemption, as his home is only worth about 100k. So, as suggested, it might indeed be better to leave things the way they are.

You guys are great, getting me to know what the general issues are, I will certainly do more research and consult a pro.

People are sick and tired of being told that ordinary and decent people are fed up in this country with being sick and tired. I’m certainly not, and I’m sick and tired of being told that I am

[Southern_Man 0]

You really need to talk to a professional. Medicaid in my state has an exemption for a primary residence. Not sure if this is true in all states. Medicare is generally not resource dependent.

"What if there were no hypothetical questions?"

[sundevil777 102]

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You really need to talk to a professional. Medicaid in my state has an exemption for a primary residence. Not sure if this is true in all states. Medicare is generally not resource dependent.

Thanks, I'll try to confirm the exemption issue. Since I already will get the house upon death without even the need for a will or any probate issues, we both may already be in the best position.

People are sick and tired of being told that ordinary and decent people are fed up in this country with being sick and tired. I’m certainly not, and I’m sick and tired of being told that I am

[squirrel 0]

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You really need to talk to a professional. Medicaid in my state has an exemption for a primary residence. Not sure if this is true in all states. Medicare is generally not resource dependent.

Thanks, I'll try to confirm the exemption issue. Since I already will get the house upon death without even the need for a will or any probate issues, we both may already be in the best position.

and that is a good point there...make sure your paper (wills/trusts) work is in order...you dont want probate to mess things up. so many people dont have a good will or trust, and "get hit by a bus" if you will, and it leaves a headache (added to the pain of loosing a loved one) and additional costs for surviving family members.

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Where is Darwin when you need him?

[jumpwally 0]

WARNING !!!! You hit it on the head there,,if you are trying to bypass that unfortunate senario, be fore warned that they go back 3-4 years and check. You best check in with a good Tax Attorney that has a CPA on staff and most do. You need serious legal advice , don't be afraid to spend the money....1200 bucks or so can save you a 100 fold.......

smile, be nice, enjoy life
FB # - 1083

[lawrocket 3]

I'd suggest that your father get an attorney for this. To protect YOU. Seriously.

While I am unfamiliar with AZ law, I do suspect that they have laws against financial abuse of an elder. The situation that you discuss is almost a textbook example of something that could constitute this - especiaoly if you have siblings or grandchildren who say, "he's taking it all for himself." You are now defending yourself in an ekder abuse suit.

GET AN ARIZONA ATTORNEY FOR YOUR DAD! Since there is nothing owing, go through an escrow process and get a grant deed instead of a quitclaim.

Have some consideration for your dad and possibly give him a life estate.

My wife is hotter than your wife.

[Jewels 0]

Lawrocket is right--get a local attorney to advise on this. It sounds like perhaps you're taking title by beneficiary's deed or your local equivalent? It can be a great vehicle but avoiding probate can be challenging just the same.

You might find out things like what your bank will require to set up an account for your father's estate. I couldn't open an account for my mother's estate because the bank required letters testamentary from the court and Mom's account wasn't in probate. It hasn't been a big problem, but it could have been, as some checks following her death were made to her estate and not to me. I couldn't deposit the checks into her account or mine. I was able to get one of the checks re-issued to me, but they did so only reluctantly and after I supplied a LOT of documentation to prove that I was entitled to the funds.

You might also inquire as to whether the property conveyance to you would legally be considered part of your father's estate. Some transactions may require you to provide a small estate affidavit if the estate is not in probate, BUT, some small estate affidavits cannot be used if the estate includes real property. This doesn't have to be a big problem, but it's something I would have liked to know about before trying to settle Mom's affairs.

Your desire to avoid probate is understandable, but you might want to be sure that it's not going to create unexpected problems along the way. Have your father get an attorney who can advise on the tax ramifications of the various sorts of conveyances and who can then explain what has to happen once he has passed away, and be sure he has a will even if it's a simple one.

You might also contact the local bar association to ask whether there are any local organizations that will provide free or low cost assistance to seniors in drafting a will and/or advising on estate matters. You and your father likely would know if there are any special matters that require more specialized legal advice, but preparation of a simple estate does not have to break the bank.

TPM Sister #102

[Andy9o8 2]

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Lawrocket is right--

I agree; I just try not to tell him too often so he doesn't get a swelled head.


Good advice from Lawrocket and Jewels.