QUESTION
If I give my home to my son, does he have to pay inheritance tax when I die?
Asked on Sep 28th, 2015 on Estate Planning - Pennsylvania
More details to this question:
If I give my home to my son (sale price $1.00) now with the understanding that I can live there and he will take care of me instead of putting me in a nursing home, does he have to pay inheritance tax on the home when I die? Assume I live for 8 to 10 more years and have no cash or other property at time of death.
1 ANSWER
3 Awards
If you transfer the entire interest to him and you survive one year after the transfer, he will not pay inheritance tax. If you reserve a life estate in the deed, with language that allows you to live in the home until you can no longer do so or die, he will pay inheritance tax on the value of the life estate. You should sit down with a lawyer to discuss this in detail. There are other considerations when transferring your home to a child such as you may lose your Homestead exclusion, if applicable, and senior citizen discounts on realty taxes.
Answered on Oct 01st, 2015 at 5:44 PM
William R. Pelger, Attorney Munhall, Pennsylvania 412-461-1900