Jack McMasters
New Member
- Jurisdiction
- California
Mother bought SFD in 1974 in sole ownership. It stayed a rental property from purchase to present. Currently in escrow. Mother on deathbed. My sibling and I recently quitclaimed the property to satisfy the title insurance company.
In 1981 she passed title from herself to herself, my sibling and myself as joint tenants. She never informed us of the transfer. I never found out about it until the property went up for sale a few months ago. I was browsing through her papers looking for something else and stumbled onto a copy of the deed. The original is lost. Knowing her, I believe putting us on title was solely to avoid probate, not to convey ownership. She retained all the incidences of ownership throughout the 45 years she owned the property. I took over managing the property for her 10 years ago when she became too old to do it herself. My sibling and I never once benefited from the property.
In 2004 she passed the property into a revocable trust she created for herself. She did not indicate any percentage of ownership being transferred nor did the attorney who drew up the trust. From all appearances she believed she was transferring 100% ownership into her trust. She named my sibling and I as the sole beneficiaries of the property.
Problem: if the 1981 transfer is deemed good, despite no evidence of intention on her part to convey ownership to us or evidence of delivery and acceptance of the deed--add to that the transfer of what she believed to be 100% ownership of subject property into her trust and naming us as beneficiaries--if this 1981 deed is deemed to be good then my sibling and I must lose the step-up in basis and pay a huge capital gains taxes. But if it can be argued that a bonafide joint tenancy was never made in 1981, i.e. title was never successfully transferred to myself and my sibling because intent, delivery and acceptance were all missing, then my sibling and I will receive the step-up in basis and not have to pay a huge capital gains tax. Help!
In 1981 she passed title from herself to herself, my sibling and myself as joint tenants. She never informed us of the transfer. I never found out about it until the property went up for sale a few months ago. I was browsing through her papers looking for something else and stumbled onto a copy of the deed. The original is lost. Knowing her, I believe putting us on title was solely to avoid probate, not to convey ownership. She retained all the incidences of ownership throughout the 45 years she owned the property. I took over managing the property for her 10 years ago when she became too old to do it herself. My sibling and I never once benefited from the property.
In 2004 she passed the property into a revocable trust she created for herself. She did not indicate any percentage of ownership being transferred nor did the attorney who drew up the trust. From all appearances she believed she was transferring 100% ownership into her trust. She named my sibling and I as the sole beneficiaries of the property.
Problem: if the 1981 transfer is deemed good, despite no evidence of intention on her part to convey ownership to us or evidence of delivery and acceptance of the deed--add to that the transfer of what she believed to be 100% ownership of subject property into her trust and naming us as beneficiaries--if this 1981 deed is deemed to be good then my sibling and I must lose the step-up in basis and pay a huge capital gains taxes. But if it can be argued that a bonafide joint tenancy was never made in 1981, i.e. title was never successfully transferred to myself and my sibling because intent, delivery and acceptance were all missing, then my sibling and I will receive the step-up in basis and not have to pay a huge capital gains tax. Help!
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