Q: How do you transfer a piece of real estate before someone dies in order to avoid probate?
A: The owner of the real property can do that by signing and recording a deed, but he or she would be well advised to consult with an attorney before doing so. Lifetime gifts of large value items like a home are fraught with peril. First, the gift might trigger a gift tax. Second, the recipient will inherit the gift giver's tax basis, thus losing the step up in basis at death that would otherwise have occurred, thus creating in most cases a capital gains tax exposure that is much greater than it otherwise would have been. Third, the gift might create a very long Medicaid penalty period. Fourth, if the gift giver needs to continue to reside in the house, he or she will be in the awkward position of now being a mere tenant with little control over the property and even the obligation to pay rent. And, yes, it gets worse. Don't do this without legal advice.
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