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You could renounce your right to take under the will. If you do that, then for legal purposes you are treated as if you died before your dad. That would most likely mean that you siblings, if any, or your children, if any, take the property and that your Aunt would not get the home.
The nice thing about renouncing your right is that you don’t have any gift tax issues. Of course, it doesn’t ensure that your Aunt takes the property and so is probably not the best option for you.
Your other option is to gift your right in the property to her. There are gift tax consequences for the value that is over $14,000 in a single year. So, whether there will be a gift tax issue depends on what the balance is on the reverse mortgage and the home value on your father’s date of death. If there are gift tax issues, you can use part of your lifetime gift tax exemption (of $5.25 million) to avoid gift taxes. You would have to file a gift tax return to use that exemption. If the value you gift her is not greater than $14,000, then you would not need to file a gift tax return.
So, the short answer is that you can give the home to her without worrying about taxes. You'll just potentially need to file the gift tax return. Please let me know if you need additional assistance. Thanks!
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