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Tuesday, June 9, 2015

The perils of adding your children's names to your property

One of the most common mistakes people make with their assets is putting one or more of their kids' names on their real estate. Usually they do this because they've heard that adding the kids' names will avoid probate fees or "make things easier" or other reasons that have little to do with actual ownership of the house. Because it's easy and cheap to do, many people don't get legal advice and therefore don't really fully appreciate the consequences of their actions.

I frequently talk about why adding the kids' names can be a terrible idea. In my view, it needs to be discussed often, as so many people make the same mistake. I'm glad to know that I'm not the only one talking about this, as I've recently come across a really good article from Lilian Cazacu, a notary in BC. If you have added your child's name to your home or cabin, or you're thinking about it, I highly recommend that you click here to get the real story on what adding that name could do to you and your estate. You'll find other excellent articles on that site as well.

3 comments:

  1. Lynne, I did not realize that it was even an option to list a child as a partial owner of your home. Thank you for spreading the word, however, about the potential problems this may cause in the future. It strikes me in the article you linked to, that listing you adult child as a partial owner of the home may bring negative taxes into your accountability. No one wants to pay more taxes than what is necessary. http://www.ourlegalteam.com/swissvale-pa-estate-planning.htm

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    Replies
    1. I was referring only to adult children. You cannot add a minor child to the title.

      Lynne

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  2. Our family has a piece of land that has been in the family for over 100yrs. There are some sheds & out houses but no utilities, hydro, water, septic or a proper driveway. It's best assets is that it's on the water, immediate family uses it in the summer to camp on. Recently our mother passed away and unbeknownst to us dad had her name taken off the title- he can't explain why. Of the three kids; my brother and I have been paying the taxes (halved) for the past 10 years. Our sister has sponged off our parents most of her life and recently came out of filing bankruptcy. Since mom's passing we discovered a joint bank account her and my mom had, she's kept that money for herself; our father is now aware of it but not the amount within and is not planning on asking our sister about it. Prior to mom passing they'd worked out that the family home my father still lives in would be sold when he passes; the money from it would be divided 3-ways and my brother and I would be left the property. Should my brother and I have our names added to the title of the property we've been paying taxes on, now while dad is alive? Will we be required to pay capital gains when our father passes and the property is left to my brother and I? Thank you

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