Adding daughter to property title

[rmk9785e]

What is the name of your state (only U.S. law)? California
We just closed on a rental property with the title in the name of our revocable living trust for which my wife and I are the trustees and our 3 children are future beneficiaries.
We wish to change the title so one of our children gets on the title and she will be the sole owner on our passing. Our daughter will receive all the income and will pay any expenses (taxes, etc.) going forward. My wife and I can remain on the title because we just paid $1,000 for title insurance and we're told it will cover against any prior claims to the title as long as we are on the title.
What are our options for the change in title?

 

[justalayman]

What is the name of your state (only U.S. law)? California
We just closed on a rental property with the title in the name of our revocable living trust for which my wife and I are the trustees and our 3 children are future beneficiaries.
We wish to change the title so one of our children gets on the title and she will be the sole owner on our passing. Our daughter will receive all the income and will pay any expenses (taxes, etc.) going forward. My wife and I can remain on the title because we just paid $1,000 for title insurance and we're told it will cover against any prior claims to the title as long as we are on the title.
What are our options for the change in title?

Right now you aren’t on the title if it is held by a trust. Maybe you, as trustee, are in title but that isn’t the same as you being in title.

Anyway, there are a variety of ways to do what you want to do. You could do it through the trust. You could share title as joint tenants with rights or survivorship (I don’t believe you can leave it in the trust for this), you can create a transfer on death deed, you could grant it to your daughter and reserve a life tenancy for you and your wife.


Unless she is sole title holder she is not legally entitled to all rental income nor is she seperarately liable for taxes or repairs. You can agree she pays for such and recieves all income derived from the property but when it comes down to it; all of those would legally be rights and responsibilities of all tenants.


Since the transfers can involve tax implications as well as affect the base value for purposes of capital gains for your daughter as well as how all this plays with the rest of your estates, I strongly suggest you sit down with an attorney and tax pro to figure what it is you actually want to do and how to do it in the best fashion in regards to your financial situation.

 

[rmk9785e]

<SNIP>Since the transfers can involve tax implications as well as affect the base value for purposes of capital gains for your daughter as well as how all this plays with the rest of your estates, I strongly suggest you sit down with an attorney and tax pro to figure what it is you actually want to do and how to do it in the best fashion in regards to your financial situation.

Thank you. We'll do just that.

 

[FlyingRon]

Understand that there is no single title for real estate. It's a chain of all the deeds over history. Being "on the title" isn't like some club membership, you are GIVING them some ownership interest in the property.

If the trust is revocable, you're free as the trustee to grant the property to whomever.

Note that giving property away to people is usually lousy estate planning. You can amend the trust to change who gets the property if that's what you want to do. As justa points out there are implications for you and your daughter if you give the property to her now rather than waiting for you to die. Why do you think you need to do that?

 

[rmk9785e]

Understand that there is no single title for real estate. It's a chain of all the deeds over history. Being "on the title" isn't like some club membership, you are GIVING them some ownership interest in the property.

If the trust is revocable, you're free as the trustee to grant the property to whomever.

Note that giving property away to people is usually lousy estate planning. You can amend the trust to change who gets the property if that's what you want to do. As justa points out there are implications for you and your daughter if you give the property to her now rather than waiting for you to die. Why do you think you need to do that?

Thank you. I made it unnecessarily complex. We purchased the property on our daughter's behalf because she wasn't available to sign the offer at that time so the transaction was completed in our name. We need to change ownership because it IS her property. There are no tax impact from cost basis perspective because it is transferred within the same month and property value has not changed.

Well, we went ahead with the transfer and it was a bit messed up.
We were assisted by a major escrow company's local office to record a grant deed of this property to my daughter. The staff preparing documents made a couple of mistakes.

1- The street address of the Grantee was misspelled (Camano rather than Camino).
2- The transfer was for no consideration however the document preparer wrote both "No Consideration" and "For a valuable consideration, receipt of which is hereby acknowledged" on the same page.

By the time we caught the mistakes, documents had already been electronically submitted for recording and were promptly recorded. When I contacted the county recorder's office, I was told no change can be made after recording and I should contact the escrow company to submit a new recording.
I wonder how could a new recording be done when there is no transaction involved.
The recorder did accept the "No Consideration" nature of the transaction and did not charge a transfer tax.

Should I not worry about it and hope that:
a- Any mailings will get to the correct address because there is no Camano street in that zip code.
b- The title will not become questionable because of the conflicging information about whether there was any 'consideration'.

If not, what steps should be taken to correct the errors?

Thank you.

 

[HRZ]

Have the property owner check , at least local to me the property mailing address for just about anything does not come off the deed but some other data base and even taxes are mailed using a different addresss list..but do make sure owner is getting tax bills and or mortgage firm ismproperly paying same , if paid that way.

To me, if the rental property owner is worried about a scribners error that is a business question formher tomaddress to her choice of counsel ( Costs of addressing business questions are likely tax deductible )

I doubt a no consideration recitation for fee purposes means anything anyplace else .

THe nature of your post is unclear who paid for what and if there is a big gift in there ...I'll assume you treated all things properly and not open Pandora's Box

 

[rmk9785e]

<SNIP>
The nature of your post is unclear who paid for what and if there is a big gift in there ...I'll assume you treated all things properly and not open Pandora's Box

Our daughter paid the whole sale price with a cashier's check so there is no big gift involved. Our gift was only the closing costs of about $3K.

Lessons learned. In the future we'll keep it simple.

 

[Zigner]

Our daughter paid the whole sale price with a cashier's check so there is no big gift involved. Our gift was only the closing costs of about $3K.

Lessons learned. In the future we'll keep it simple.

In other words, she gifted YOU all of it except for ~$3k

 

[HRZ]

I would have guessed at a different asset shifting game ...which apparently was not afoot.

AT least at a lay level, notwithstanding some sloppy steps , I think this lacked any donative intent by any party but I'd not wave a red flag and invite debate .