Q: I am about to acquire a new property. Can I add my two adult daughters to the deed as owners?
A: Generally, you can add anybody as a co-owner of a house. However, if you are going to a need a mortgage to byt the house, then your lender may have an issue with other people being on the deed. In addition, by adding your daughters as co-owners, this could result in problems in the future if your daughters need to apply for bankruptcy or if your daughters are sued and a judgment is filed against them because the house may be subject to the claims of your daughters creditors. Also, the house may be subject to equitable distribution if one of your daughters has to file for divorce in the future. If you later want to sell the house and you have a falling out with your daughters, then you may have to go to court to force your daughters to work with you to sell the house. Also, there may be gift tax consequences because by adding your daughters as co-owners but they did not pay for the house, then the IRS may treat the transaction as if you made a gift of partial ownership of the house to your daughters. There are several other problems that could arise so you should consult with a legal professional before you add your daughters on the deed.
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