Daughterof1930 Asked January 2016
Is there an advantage to having my Dad change the deed to his house from solely in his name to having my name also?
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I know the best answer to this is "ask an attorney" and I do have an appointment with one, but thought I'd ask here. My dad is sole owner of his house, his biggest asset, since my mom died. I'm executor of his will and his POA. I've read that there are expenses that are avoided after his passing if the house has the name of the executor on it. Have no clue if this is true. I'm supposed to sell the house and spilt the proceeds and all other assets equally three ways between my siblings and myself, a task I most definitely do not look forward to! Wondering in advance if there are things I should be considering to make it any easier?
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So based on atty meeting you are going to keep the house as titled, right?
It sounds like you are the point person for all things dad. As such, I'd bet you often get things & pay as needed for dad or his house. Light bulbs for his front porch last week while you were doing your own shopping, type of expense. I'd suggest that you get a memo of understanding or perhaps even a promissory note done between you & dad that any & all costs spent by you on dad or his property is to be reinbursed to you either from the sale of his home when alive or from any assets of his estate after death. The memo or PN needs to be signed & witnessed. You can have an interest on the debt as well as it technically is like any other loan. Your atty will know how to do this & they will likely have it notarized & placed in the file for when probate is opened. Having this done can deflect from Sissy wanting these funds included in your share of the final cut. It can also establish that any of these costs are a binding agreement or future claim against the estate that you have if dad should go on Medicaid.
You do need to keep receipts, invoices, canceled checks etc to document this.It will add up.
About in the future & probate, try to find out how probate can be done in your state. Some states are full probate easy (TX) with pretty wide timeframe to complete (4yrs for Tx). Some allow for small estates affadavit & some even for a muniment of title to be done. Muniments are could be a DIY if you have your wits about you imho. If you are named executor in the will, it's up to you to determine what to do in what timeframe. No matter what Sissy carps....
As executor you can be paid if there are $$ assets in the estate. It's usually a % based on the value of the estate. (I was executrix for an aunt decades back who died with $$ and it was around 5% of final & a draw on expenses). If there are no assets but the house (which would be the case if they are on Medicaid), you can still tally up the costs paid for travel costs (mileage & hotel) & MIE (meals & incidental expenses) related to administration of the estate as your own claim against the estate. MIE is done at federal rate set for your state. If you are dealing with Medicaids MERP, state laws usually have executor claims paid first & before others (like MERP) too. Probate judges have a good bit of discretion on claim presentation as well. A good probate atty will know how the courtroom & it's staff atty's to the judge run the process. If the atty you saw does probate as well this is good; if not, find out who they turn probate legal over to.
If you think Sissy will be difficult in all this, I'd ask your atty just how they (the firm) deal with litigation. Most probate guys are small office or solo practice & do NOT do litigation ever. The costs will skyrocket if so. You want to know what's what so you can deflect Sissys thinking. Good luck & stay organized.
We were fortunate in that my Mom's siblings all got along, but even without stupid/greedy/criminal/useless relatives it's still a huge chore in the best of families.
Garden Artist rightfully brings up the topic of capital gains tax. If dad is the only owner, the house gets a step-up in basis to market value as of the date of death. If the house is co-owned, only half of the house gets the step-up, resulting in capital gains on the other half. You are wise to consult with an attorney to help you decide the best course of action.
If the will provides for equal division of the assets, which include the proceeds from sale of the house, transferring title to your name now could I think alienate your siblings, unless you have the will updated through a codicil explaining and addressing this action, reiterating that the proceeds from the house will be split equally despite the fact that you're holding title to the house.
What's the justification for transferring title in the first place beyond the possible avoidance of expenses? What you need to investigate, and I believe this is the case, is that the value of the house is stepped up to date of death, and no improvements which increase the value are factored into the tax assessment.
So if you and your siblings inherit the house at market value on the date of death, the only other expenses I can think of would be those for selling any house.
It has been awhile since I've discussed this with our attorney, and some tax laws have changed, so this is really a question for your estate planning attorney. And I write about the step-up value issue with that caveat.
I assume that you're prepared to provide insurance, pay for utilities, take care of maintenance, etc. on the house?
Frankly, though, given your concern about dividing all assets equally among the adult children, I think this action would be misinterpreted as trying to avoid having to split the proceeds of the house with your siblings.