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Financial Planning / Tax Strategies
|Subject: Re: House transfer: Father to Sons||Date: 6/20/2006 8:41 PM|
|Author: JAFO31||Number: 87487 of 121218|
<<<<Does the retained life estate by "Dad" change any of the responses about basis? What about IRC 2036?>>>
"I'm a little unclear on whether they're talking about a life estate or JTWRS. The first comment from the OP mentions JTWRS."
I know. And I know that OP did not use the term "life estate" but Op did write about a document "with a specific proviso that will allow "Dad" to live in his home as long as he wants" --- which sounds like a layman describing a life estate. But who can really tell.
I inferred (whether rightly or wrongly) that the remainder interest would be held JTWROS by the two brothers, but again, WDIK?
"Should it actually be a life estate rather than JTWRS, then the valuation of the gifted amount of the house (the remainder interest) becomes an issue. But to the extent that some or all of the house in included in the taxable estate, then there would be a step up in basis. So you do have a point there."
Thanks for the explanation, peter.
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