I am 89 and would like to make sure my son receives my house. What is the best way so that he will not be weighed down with taxes?

Answering this question depends on a number of different things that you did not put in your question.  As a basic answer, making some assumptions about the value of your house, I would say its probably best to just leave him the house in your will.  Unless the value of the house (or your entire estate) is more than $675,000, your son won't pay NJ Taxes either estate taxes or transfer and inheritance taxes.  As long as you have a properly prepared will, that was witnessed by two people and notarized, your best bet to transfer the house would be in the will. 

Your question is a very common one in my experience.  There are generally two areas of taxes that should be of concern to you and your son.  In the first area of taxation, the concern are Inheritance/Estate Taxes.  New Jersey has both an inheritance and an estate tax.  There is no inheritance tax for any transfers to a surviving spouse, child(ren) or their descendants, parents, grandparents and stepchildren.  New Jersey's Estate Tax applies to resident decedents with estates exceeding $675,000.00 so if all of your property (including the house) is less than $675,000.00, there would be no Estate Tax. The Federal government imposes an Estate Tax on gross estates exceeding $5,000,000.00 currently and through 12/31/2012.  After this date, it is up to Congress and the then President and enact new legislation dealing with what the level of taxable estate will be thereafter. If your son gets this property through your will, he will inherit the house at the value at your time of death.  If you give him part or all of the property now, he will own it as if he paid the same as you when you purchased it for that part given to him.  For example, if you paid $50,000.00 for the house and it is worth $500,000.00 now, a gift to your son now would result in him owning the property at the $50,000.00 value whereas inheriting it would give him the property at the $500,000.00 value.  This is called the basis in the property. This becomes extremely important if your son decides to sell the home in the future because the difference in the sales price and the basis is taxed as a capital gain.  THere are exemptions to paying tax on this gain if it is his primary residence for at least 2 years of the 5 years preceding any sale of $250,000.00. As can be seen from the foregoing, there are many factors to determining to gift and/or will your property to your son.  THe value of your estate, the built up gains in the home and other important issues must be reviewed by an attorney in your area knowledgable in this field before making any decision. Alfred Polizzotto, III