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Mom's living trust lost the deed to her house.

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bretzke

Junior Member
CA, My mothers living trust was to leave her $600,000 house to her 6 children. But the deed to the house had been changed to my sister's and brother-in-law's name before she died for a refinance. They explained that they needed to refinance to pay off Mom's credit card debts. Now my sister has proposed to pay the rest of us the fair market value of the house so she can keep it by giving us a "gift" of $100,000 each. Would I as the receiver need to pay income tax, or gift tax on that amount? Or should the money be put back into the trust and then distributed to the Beneficiaries? Your help would be greatly appreciated.
 


Dandy Don

Senior Member
This is a question for the tax law message board or better yet by consulting your own local CPA or tax accountant.

So where is sister getting the money from to pay each the $100K? Is it coming out of the trust or from other estate assets or from her own personal monies?

DANDY DON IN OKLAHOMA ([email protected])
 

bretzke

Junior Member
Sister took out a balloon loan

My sister was able to take out a loan to pay us. They plan to move into a house they were renting and live there for two years so they can get the capital gains exemption, then sell that old house after the two years and pay off the balloon type loan they took out. Then move back into my Mom's house at the end of it all. The rest of us just wanted to sell Mom's house and divide it like she had wished. But this sister is so set on keeping the house, that we let her buy it from us. The reason I posted here was becuase everyone has been saying that we should put the deed of the house back into my Mom's living trust. Thanks for the help.
 

nextwife

Senior Member
bretzke said:
My sister was able to take out a loan to pay us. They plan to move into a house they were renting and live there for two years so they can get the capital gains exemption, then sell that old house after the two years and pay off the balloon type loan they took out. Then move back into my Mom's house at the end of it all. The rest of us just wanted to sell Mom's house and divide it like she had wished. But this sister is so set on keeping the house, that we let her buy it from us. The reason I posted here was becuase everyone has been saying that we should put the deed of the house back into my Mom's living trust. Thanks for the help.
You DO realize that once house is in sister and BILs name, "we " cannot do anything about deeding the property. The ONLY people who can deed the property are the owners, who are no longer the trust.
 

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