Thanks for following up. There won't be any taxes due when she dies and you inherit her interest
in the property. California
does not have an estate or inheritance
tax. And, on the Federal
level, an estate is exempt
from estate tax
unless the estate is in excess of $5,250,000. Thus, you don't need to worry about taxes at death with respect to this property. If she gives it to you now, however, her basis carries over to you; if you get it at death, the basis gets stepped up to its fair market value...so, if it's appreciated since it was purchased, you are better off tax-wise getting it at death than getting her interest now.
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