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 Merlo Your Own Question

Merlo
Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
9573734
Type Your Tax Question Here...
Merlo is online now
A new question is answered every 9 seconds

after issuance of Quit Claim deed (wife & I grantors)...son

Resolved Question:

after issuance of Quit Claim deed (wife & I grantors)...son grantee...any future IRS claim involving wife or me, is property in reach of IRS?
Submitted: 4 years ago.
Category: Tax
Expert:  Merlo replied 4 years ago.

Hello JA Customer,

 

Where the taxpayer's property is transferred such that someone else holds title to the property, but the taxpayer continues to enjoy the full use and benefit of the property, the person holding title may be deemed to hold the title as a nominee for the taxpayer, i.e., in name only. In such an instance, the IRS may file a nominee lien with respect to the property. The lien filed in the name of the nominee is filed only with respect to the taxpayer's property held in the name of the nominee.

 

The government bears the burden of proving the nominee status by a preponderance of the evidence. Factors considered in making this determination include the following:

  • no consideration or inadequate consideration paid by nominee
  • property placed in nominee's name in anticipation of a suit or the occurrence of liabilities while the transferor continues to exercise control over the property
  • close relationship between transferor and nominee
  • failure to record conveyance
  • retention of possession by the transferor
  • continued enjoyment of benefits of the property by the transferor

Since you would basically be signing over this property to a close relative for no monetary consideration and in anticipation of a possible lien, this property would still be subject to lien by the IRS.

 

 

Thank you

 

 

Customer: replied 4 years ago.
the fact that our son paid over $98,000.00 to satisfy the mortgage (2003) and permit my wife and I a clear warranty deed...what consideration would the IRS have to make given that situation...given the fact that we retain possession,enjoy benefits of property, etc., etc.
Also,we have a recorded Quit Claim deed on record with county courthouse. Is that not proper record of conveyance?
Expert:  Merlo replied 4 years ago.

Hello again joyce,

 

Even though you may have recorded the quit claim deed with the county, that is only one of several factors that the IRS looks at in determining whether or not the property is simply being held by a nominee. Most, if not all of the other factors on that list still appear to apply in your situation.

 

I am not quite clear as to what transpired with the $98,000 that you say your son paid on your mortgage. If your son was not legally liable for this debt and simply paid that amount on your behalf, he should have filed a gift tax return back in 2003 to report this as a gift that he gave to you. No gift taxes would have been due since the amount is still well below the $1 million lifetime exemption he is allowed on gifts, but he would have been required to report the gift by filing Form 709.

 

If you can show that your son did contribute this amount of money to payments on the home, then you might possibly have a case for the IRS not to include the entire amount of the property in the tax lien. But there are enough other factors here that they could still certainly file a tax lien for the value of the home that exceeded that amount.

 

 

Thank you

 

 

Customer: replied 4 years ago.
2008 a post nuptial agreement placed all real and personal property in my wife's possession. Same time we filed the Quit Claim Deed. Can this allow the issuance of a warranty deed in her name only for the home?
Expert:  Merlo replied 4 years ago.

Hello joyce,

 

Unfortunately that is not a tax question and is something that would need to be answered by a real estate attorney.

 

 

Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience: 25+ years tax consulting. Specializing in returns for US citizens living abroad
Merlo and other Tax Specialists are ready to help you

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3052
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3229
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    6121
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2783
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/OZ/ozaukeecpa/2012-6-7_193219_Picture1croppedandshrunk.64x64.jpg MequonCPA's Avatar

    MequonCPA

    Certified Public Accountant (CPA)

    Satisfied Customers:

    2231
    CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.