Aging parents often times add their child or children to the title of their home. They believe that in doing so, the child will be able to sell the home or easily inherit the home should anything ever happen to them.
When you purchase a home, the property taxes in California become your tax base. When you pass away, that tax base transfers to your child. However, if the child is added to the title, the tax base becomes adjustable upon the changes to the ownership of the deed.
There are many other areas where adding a child to title can cost the parent them their home.
The child's equitable share in the property can become community property in the event of divorce. Creditors, lawsuits, judgments… they can all be attached to the title. Anything attached to the social security number of the parties holding title, can attach to the title of the home.
Before you make changes to the title of your home, consult with an expert in asset protection.
If you don't have an estate plan, the state of California has one for you. And the cost can be 6-10 times greater than the proactive approach of an estate plan.
Our firm can review your current trust and consult with you on various options for asset protection.