Die Large

Die Large
should I give my son the family home before I die to help prevent large inheritance tax bill?

Remember that the tax exclusion is $2 million this year, $3.5 million in 2009, and there is no Estate tax at all in 2010. 2011 and beyond is a question mark but the two presidential candidates are leaning towards $3.5-$5 million in the years after 2010. If your total estate is smaller than that then your estate will pay no tax at all. BUT is you give your son your home then he also gets your basis cost in the house. So if you paid $50K years ago and the house is now worth $500K then he is stuck with your tax basis of $50K and if he sells the property, then he will owe capital gains tax on the $450K gain. If your leave him the house as an inheritance then your son’s basis cost in the property “steps up” to the value on the day you die. So his basis becomes the $500K value of today. If he sells the property for $500K then he will owe 0 capital gains because he has the stepped up basis of $500K and not your basis of $50K.
Added to the tax implications is the fact that if someone sues him and he loses then they could take your house because it is now your son’s asset and not yours anymore. Or if he gets a divorce, you could lose your house due to his property settlement since your house will be his asset acquired during the marriage and not yours. If you give him the house now it may be seen by the court as a “marital” asset. If he inherits the house then it is “sole and separate:” property and his alone and cannot be counted as commumity property.
All on all, this is an idea that sounds good in theory but can be a very expensive mistake,

Marianne Design CREATABLES Stencil Dies ANJA’S ROSES LARGE CORNER LR0214 $14.62

new SIZZIX ORNAMENT VALENTINE LARGE DIE NIP $8.09

LARGE Die Cutter RABBIT HEADS fits Big Shot $9.47

Deckled Rectangles Large Spellbinders Nestabilities Mega Dies S5015 $21.66

Scalloped Octagons Large Spellbinders Nestabilities Dies S4187 $21.55

Scalloped Long Rectangle Large Spellbinders Nestabilities Dies S4143 $21.55

I-Top Die Carriage Large 28mm ITOP1310 $7.24

Petite Scallop Circle Large Spellbinders Nestabilities Dies S4115 $21.55

Standard Circle Large Spellbinders Nestabilities Dies S4114 $21.55

Classic Scallop Rectangle Large Spellbinders Nestabilities Dies S4133 $21.55

Classic Square Large Spellbinders Nestabilities Dies S4126 $21.55

Classic Scallop Square Large Spellbinders Nestabilities Dies S4127 $21.55

Classic Rectangle Large Spellbinders Nestabilities Dies S4132 $21.55

Big Scalloped Rectangles Large Spellbinders Nestabilities Dies S4255 $21.55

Big Scalloped Squares Large Spellbinders Nestabilities Dies S4253 $21.55

SIZZIX X-LARGE DIE MOVERS SHAPERS WINDOW FRAME A2 CARD KIT #1 $12.99

SIZZIX DIE BREAST CANCER AWARENESS LARGE RIBBON RARE RETIRED $19.99

Sizzix Birthday Cake large die #654609 RARE,Retired $7.99

Sizzix Birthday Cake #2 large die #655014 Cuts Fabric!! $7.99

LARGE Die Cutter TEDDY BEARS fits Big Shot $9.47

Sizzix Original large Flower Layers #2 die #654980 Retail $15.99 – Cuts Fabric! $7.79

NEW SIZZIX CRACKED EGG LARGE DIE RETIRED! RARE!!! $8.99

Sizzix Cat & Cat Toys large die #655025 Cuts Fabric!! $9.49

Sizzix Dog w Bone & Dish large die #655342 Cuts Fabric! $8.49

Sizzix Dog & Dog Toys large die #655026 Cuts Fabric! $8.49

BUG NET GIRL LIKE LARGE SIZZIX SIZZLIT DIE $4.99

Spellbinders Nestabilities ~Classic Scalloped Squares Lrg Dies $5.05

SIZZIX LARGE DIE FRAME SCALLOP EDGE -/HEART & FLOWER $0.99

Spellbinders Nestabilities ~Classic Scalloped Ovals Lrg Die $6.50

Sizzix Primitive Hearts#2 large die #380157 Cuts Fabric $7.99

Spellbinders Nestabilities – Classic Squares Large — 7 Dies $14.99

SIZZIX CANDY CANE & BOW LARGE DIE NIP $7.19

Little Angels – Custom made Large Die (Not Wooden) $15.73

LARGE Die Cutter BIRTHDAY GIRL fits Big Shot $4.73

Sizzix Original dies, doll, stars, swirl, leaf, leaves, balloon, basic shapes $9.00

---