Sign over home.

[tedean]

My parents who are in their mid 80's want to sign their home over to us, their 4 children.
They have considered this for several years, but have heard stories of children removing parents and taking the money.
My fathers sister is receiving elderly care at home and her home had to be sold to pay for services. I believe this is what started them thinking!

My brothers and sister are in our 50's and get along well.
We have spoke to each other about this and agreed to have a family contract drawn up saying they would never be removed from their home as long as they are physically able to stay their.
Can you tell me if this is a good choice for them to make?
Any legal issues to aware of?
And what legal documents should be drawn up?
P.S. They have a Will, Power Of Attorney and living will in place.

 

[knight75]

not really a good idea.
1. step up in basis. when they die, you recieve it with no taxable gain. If it's signed over (really gifted) then somebody has to pay taxes on the gain
2. so what if that wonderful brother runs over my cat. I love my cat. I'm gonna sue the living crap uot of him and get the WHOLE house.
3. lose of control, lose of dignity
4. depending on your state, they are now screwed and will have to pay for nursing home care. not that everybody goes to a nursing home. But wasnt that the reason you gave it away in the first place??
5. Thereal question is: what is their plan to pay for CARE. figure that uot first. then you'll know what to do about the house.

the probable solution could be an IDGT. Intentionally defective grantor trust.

was dad in the military at any time?