How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Richard Your Own Question
Richard, Attorney
Category: Estate Law
Satisfied Customers: 53727
Experience:  29 years of experience practicing law, including tax and estate planning.
Type Your Estate Law Question Here...
Richard is online now
A new question is answered every 9 seconds

When my mother-in-law bought her home in 1980, she put it in

This answer was rated:

When my mother-in-law bought her home in 1980, she put it in both her and my wife's name. There are no other heirs. When my mother-in-law dies and we sell the house, will my wife have to pay capitol gains on her half? Should we have the entire house deeded solely to my mother-in-law before she dies, to avoid the capital gains tax?
Welcome! My goal is to do my very best to understand your situation and to provide a full and complete answer for you.

Good morning. Yes, only your mother in law's interest in the house will get a basis step up at your mother in law's death. If your wife were to transfer her interest to mother in law, and mother in law dies, then the entire property would be stepped up. This risk, of course, is that your mother in law doesn't leave the house to your wife in her will or that she has creditors that go after it to pay the mother in laws bills. But, otherwise, you are correct in your assessment.

Thank you so much for allowing me to help you with your questions. I have done my best to provide information which will be helpful to you. If I have not fully addressed your questions or if you have any follow up questions, or if I have misinterpreted your questions in any way, please do not rate me yet, but simply ask a follow up question without rating so I can provide you with a fully satisfactory answer. If I have fully answered your question(s) to your satisfaction, I would appreciate you rating my service with 3, 4, or 5 faces/stars so I can receive credit for helping you today. I thank you in advance for taking the time to provide me a positive rating!
Customer: replied 3 years ago.

Thank you. I think I understand what a" basis step up" is but could you give me a simple definition? Also, what legal instrument should I use to transfer my wife's interest in the house to my mother in law?

Thanks so much for following up. It means that at death, the basis gets increased to the fair market value of the property. Thus, when you sell the property at that fair market value, there is no gain and as a result, no tax. You would transfer title to your wife's interest by quit claim deed....she would sign, have it witnessed and notarized, and then record it in the real property records of the city/county in which the property is located. Let me know if you need a template for the deed and I'll be happy to provide one for you. Thanks.
Richard and 5 other Estate Law Specialists are ready to help you
Thank you so much for the positive rating! I appreciate having had the opportunity to serve you! If I can be of assistance to you in the future, just look me up and I will be happy to help! For easy access, my bookmark is:

Related Estate Law Questions