Transfer of property?

[steffb503]

What is the name of your state (only U.S. law)? NJ
Father in law transferred property he owned in NY to one of his daughters.
He maintained a cash flow in the management of rental units on the property as well as a bar on the property. The liquor license was in his name. He paid all the bills, taxes and maintenance of this property, collected rents and keep the difference.

There was no formal contract for this the daughter simply let her dad continue on with what he had always done. It gave dad something to do.

Tax law state that if you maintain cash flow from the property it is as if the transfer did not exist? Is this correct or am I missing something?
Is this the type of cash flow they mean? If not can some one please explain what type of cash flow would invalidate a property transfer?

 

[LdiJ]

What is the name of your state (only U.S. law)? NJ
Father in law transferred property he owned in NY to one of his daughters.
He maintained a cash flow in the management of rental units on the property as well as a bar on the property. The liquor license was in his name. He paid all the bills, taxes and maintenance of this property, collected rents and keep the difference.

There was no formal contract for this the daughter simply let her dad continue on with what he had always done. It gave dad something to do.

Tax law state that if you maintain cash flow from the property it is as if the transfer did not exist? Is this correct or am I missing something?
Is this the type of cash flow they mean? If not can some one please explain what type of cash flow would invalidate a property transfer?

"You may possibly be misunderstanding the law. Under the tax code it may be "as if" the transfer never occurred for the purpose of income tax, but that would not necessarily invalid the transfer under real estate law. What is your goal? Do you wish to wrest ownership from the daughter?

 

[steffb503]

No I wish it not to be part of his estate.

I really was hoping for the circumstances in which a cash flow creates the issue, what type of cash flow do they mean?

 

[justalayman]

I just realized you have this, a second thread, about the same issue. Same here as the other thread; management does not equate to ownership. Somebody is confusing tax laws and licensing laws with actual ownership. In the tax and liquor codes they may consider a person who derives income as a quasi-owner but that does not make them a legal owner of the property. When dealing with their estate, that is what matters.

 

[steffb503]

Yes I guess I could have combined the two questions.
One about the cash flow the other about how the transfer of the deed effects the estate.
I guess they really are the same issue.
Thanks