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 Stephen G. Your Own Question
Stephen G.
Stephen G., Sr Income Tax Expert
Category: Tax
Satisfied Customers: 7096
Experience:  Extensive Experience with Tax, Financial & Estate Issues
Type Your Tax Question Here...
Stephen G. is online now
A new question is answered every 9 seconds

My husband had my mother in law transferred to m a while ago

Customer Question

My husband had my mother in law transferred to him a while ago under a life estate where my mother in law remained in her house until her death December 13, 2013. The house was finally sold this past February. Was never occupied since her death as it took all this time to fix it for sale.
What is the basis for tax this year?
Submitted: 1 year ago.
Category: Tax
Expert:  Stephen G. replied 1 year ago.

First of all, you mean that your husband had his mother's home transferred to himself where his mother retained a life estate in her home & further she stayed in the home until she died. This being the case, putting aside for the moment that a gift tax return should have been filed at the time of the transfer (no gift tax would have been due).

When a decedent retains a lifetime interest in their home after a transfer to another individual, for estate tax purposes, the home would still be included in the decedent's estate. Since unless you are dealing with an estate in excess of $5,000,000. there is no estate tax or estate tax filing due. However, the good news is that your husband's tax basis in the property is adjusted to it's fair market value at his mother's date of death. So, for example if he were to sell the home now, the capital gain would only be based upon the difference between the net proceeds from the sale and the value of the home on his mother's date of death.