If my mother deeds her home to me will I have to pay taxes based on the value of the house?
Full Question:
Answer:
A deed is an instrument by which an owner transfers an interest in land to a new owner. The deed is necessary to transfer title to land even if it is a gift. There are two basic types of deeds: a warranty deed, which guarantees that the grantor owns title, and the quitclaim
deed, which transfers only that interest in the real property which the grantor actually has. A quit claim deed contains no warranties and the seller doesn't have liability to the buyer for other recorded claims on the property. The purchaser takes the property subject to existing
taxes, assessments, liens, encumbrances, covenants, conditions, restrictions, rights of way and easements of record. Quitclaim deeds are often used among family members when there is little question about existing ownership.
Some property taxes are based on a proportion of the value of the property being taxed and ownership of the property. Property owners must pay these taxes whether they actually use the property or not or whether it generates income for them or not. Full and partial tax exemptions may exist, including those for the property’s use, such as for religious or
charitable purposes, and the form of its ownership, such as household goods. Homeowners' exemptions are primarily governed by state laws, which vary by state, and can deal with such matters as the amount of real estate taxes owed on the home, among other issues. Some states require a recorded claim to be filed in order to claim a homestead exemption, while other states require a designation of homestead. Homestead exemption forms are usually available from the county tax assessor. Local laws should be consulted for specific requirements in
your area.
There are many situations in which it may be desirable to add or delete a person's name from a deed, such as adding or removing a spouse, child or sibling. As an alternative to the quit claim deed mentioned above, you might consider adding your name by a deed from your Mother to your Mother and you, and both of you, as owners, would then be liable for
taxes. If the property is to ultimately go to you only, then this deed must contain joint tenants, with rights of survivorship language. Joint tenancy is a form of ownership by two or more individuals together that differs from other types of co-ownership in that the surviving joint
tenant immediately becomes the owner of the whole property upon the death of the other joint tenant. State law, which varies by state, controls the creation of a joint tenancy in real property. Generally, for transfers to two or more persons who are not husband and wife, the
deed or conveyance must expressly state an intention to create a joint tenancy by noting that the property will be held not as tenants in common but as joint tenants with rights of survivorship. Joint tenancy property passes outside of probate, however, it may be severed so that the property becomes part of one person's estate and passes to that person's heirs. Each joint tenant has an equal, undivided interest in the whole property, and may enter onto, take possession of the whole, occupy, and use every portion of the common property at all times and in all circumstances. All joint tenants, and their spouses, must sign deeds and contracts to transfer or sell real estate. On the other hand, if the deed provides for ownership as tenants in common, each owner will own a portion of the property, which may be unequal, but each will have the right to possess the entire property. There is no "right of survivorship" if one of the tenants in common dies, and each interest may be separately sold, mortgaged or willed to another. Upon the death of a tenant in common there must be a court supervised administration of the estate of the deceased to transfer the interest in the tenancy in
common.