You Don’t Need to Put Your Kids on Title…

Another question I get quite a bit from people is whether they should put their children on title to their home in order to do themselves and their children a favor when they die. But is this the right thing to do?

The answer, of course, in true legal fashion, is sometimes.

If your parent puts you on title, and then wants to sell the home, there may be tax implications to you that you don’t want. You may appreciate receiving your share of the proceeds, but at the same time, if this property is not your principal residence, you may be subject to capital gains, while your parent may not.

In these instances, it would probably be better for your parent to take the total gains, and give you your portion later. There are many ways in which this can be done, which would save both of you on taxes. I’m going to blog more on this in the near future, and as always, you need to talk with a tax advisor before you make any decisions.

On the other hand, if your parent is elderly, not planning on selling, and just simply wants the piece of mind that you will be able to handle the home when they pass, it may be ok to be on title. The best way, though, most of the time, is to make sure your parent has a complete estate planning package. Not only will it make it easier for transfer of assets when they pass, but you’ll also have powers of attorney for property and healthcare should you need them.