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Good evening. Because you have a mortgage, your loan documents are going to have a provision requiring your lender's consent to the transfer of the property and assumption of the loan. But, presuming the lender agrees, you simply need to sign a quit claim deed transferring the property to them, have the deed witnessed and notarized, and then record it in the real property
records of the city/county in which the property is located. If you need a form for the quit claim deed, let me know and I will be happy to provide one for you.
There should be no gift tax consequences with regard to the excess of the value over the amount owed on the mortgage. Recipients of gifts are not subject to gift tax. And, there should also be no gift tax due from the donor. Each donor can give $14,000 per year per person under the annual gift exclusion. In addition to that, each person has a $5,250,000 lifetime exemption....which means a person can give a cumulative amount of up to $5,250,000 in gifts without incurring gift tax....the donor must file a gift tax return to let the IRS know how much of the lifetime exemption is being used, but there will be no gift tax until cumulative gifts have exceeded the $5,250,000.
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