how to avoid gift tax when adding partner's name to deed

What is the name of your state? Connecticut
I have been in a longterm gay realtionship (7 1/2 years). Prior to this I had bought land. Two years ago, we built our home, but when it came time to close on the mortgage, and i wanted to add my partner's name to the deed (via a quit claim), the lawyer said we would incur a gift tax of over $100,000 because I had put most of the money into the construction. (I make substantially more than my partner).
Is there any way we can structure things so that he will have a 50% claim of the property without having to pay a gift tax?
Thanks.
Dave

[abezon]

Many ways. Sell him 1/2 with a seller-financed mortgage you never collect. Gift him $11,000 of equity per year. Put the house into a Limited Liability Partnership and give him $11,000 worth of shares each year.

For more details on how to do these things, consult A Legal Guide for Gay & Lesbian Couples, published by Nolo Press. Be sure to run your agreement by a lawyer in your state before signing anything.

I have ordered the book you recommended. Thanks.
I have a question on the mortgage...how would that work? I would sell half the interest in the house to him, but not collect?

We had thought of the gifting $10k per year, but that will take decades.

We also had thought of just leaving my name on the deed and adding him as joint tenant with right of survivorship, but if we broke up, the gift tax would still apply.

[abezon]

Originally posted by dave4242
I have ordered the book you recommended. Thanks.
I have a question on the mortgage...how would that work? I would sell half the interest in the house to him, but not collect?

Exactly. Set up the mortgage so that his annual payments total $11,000. Make it interest free, and you claim all the mortgage interest on your Sch. A. Be sure you sell him 1/2 the house but retain the right to buy him out at a set price/formula.

We had thought of the gifting $10k per year, but that will take decades.

Are you in a rush? Leave him the house in your will as a backup no matter what you do. Get a lawyer to draw up a nice iron-clad will for you.

We also had thought of just leaving my name on the deed and adding him as joint tenant with right of survivorship, but if we broke up, the gift tax would still apply.

You'd have to file a gift tax return this year, and if you broke up, he'd have to file a gift tax return that year. You'd both reduce your universal exclusion without gaining anything.