Should You Add Your Child to the Title of Your House? (Video)

If I add my child’s name to the title of my house, wouldn’t that be the easiest way to avoid probate and transfer it quickly after I die?

The short answer: NO!

Here’s the scoop

When you put your child’s name on the deed to your house, you are making a gift to them.

You’re running a lot of risk when you do this. Take these into consideration:

Selling the House

You’ll have to ask your co-owner (your child) first. They have to sign the paperwork. Even if they agree to sell, they may demand their portion of the proceeds from the sale.

What if your Child Dies?

If your child dies, you could find yourself owning your house with your in-laws… Do you want to own your home with them?

Want or Need Medicaid?

Giving your house away, or a portion of it, may make you ineligible for Medicaid or other means tested benefits. Many of these programs, including Medicaid, look back 5 years to see if you’ve given away property.

What About Other Children?

Putting just one name on the deed can start a family feud with the other children. You’re putting a lot of trust in just one child to do the right thing later.

Taxes

Putting a child on the deed almost guarantees your child will end up paying capital gains tax. Even if they don’t have to pay inheritance tax, they’ll owe capital gains based on what you paid for the property, not what it was worth when you gifted it. This can easily eat up 15% or more of the “profits.”

Accidents and Creditors

Their auto accidents and creditors will become yours too! If they get in financial trouble, your home may be up for grabs.

Conclusion – Should You Add Your Child to the Title of Your House?

You don’t need to add your child to the title of your house!

You can still accomplish your goals AND save your family one giant headache.

This is what we do and we help people with this all the time.