What we verified in “Adding a family member to your deed: gift tax and risks”

Statements and where we checked them

The statements with rules, figures or dates, with the exact place in the source and the date we checked them.

1. According to the IRS, a gift is any transfer to an individual, directly or indirectly, where full consideration in money or money's worth is not received in return; the general rule is that any gift is a taxable gift, but generally not gifts that are no more than the annual exclusion for the year, tuition or medical expenses you pay for someone, gifts to your spouse and gifts to a political organization for its use; and the donor is generally responsible for paying the gift tax.

   Sources 1 · Frequently asked questions on gift taxes (Page Last Reviewed or Updated: 23-Jul-2026): 'What is considered a gift? Any transfer to an individual, either directly or indirectly, where full consideration (measured in money or money's worth) is not received in return'; 'The general rule is that any gift is a taxable gift'; 'Gifts that are not more than the annual exclusion for the calendar year'; 'Tuition or medical expenses you pay for someone'; 'Gifts to your spouse'; 'Gifts to a political organization for its use'; 'The donor is generally responsible for paying the gift tax' · Checked October 31, 2026

2. According to the IRS, the annual exclusion applies to gifts to each donee; for gifts made in 2026 it is $19,000 per donee, the same as in 2025; if you and your spouse give away property you own together, each spouse is entitled to the exclusion, for $38,000 per donee in 2026; and the 2025 law (Public Law 119-21) raised the basic exclusion amount to $15,000,000 for 2026 gifts.

   Sources 1 · Frequently asked questions on gift taxes: 'How many annual exclusions are available? (updated December 2025) The annual exclusion applies to gifts to each donee'; 'Annual exclusion per donee for year of gift'; '2025 $19,000 2026 $19,000'; 'Each spouse is entitled to the annual exclusion amount on the gift'; '2026 $19,000 $38,000'; 'signed into law on July 4, 2025 as Public Law 119-21 and amends § 2010(c)(3) by increasing the basic exclusion amount to $15,000,000 for gifts for calendar year 2026' · Checked October 31, 2026

3. According to the IRS Instructions for Form 709 (2025 version), if you are a U.S. citizen or resident you must file a gift tax return, whether or not tax is due, in cases including when your gifts of present interests to anyone other than your spouse exceed the annual exclusion ($19,000 for 2025) or you made gifts of future interests, which get no exclusion; a gift is a present interest if the donee has all immediate rights to use, possess and enjoy the property; each spouse must file if they made a gift of property held as joint tenants or tenants by the entirety; and the return is generally filed no earlier than January 1 and no later than April 15 of the year after the gift.

   Sources 2 · Instructions for Form 709 (2025), 'Who Must File': 'you must file a gift tax return (whether or not any tax is ultimately due)'; 'Your gifts of present interests to any donee other than your spouse total more than $19,000'; 'You gave any gifts of future interests'; 'Certain gifts, called future interests, are not subject to the $19,000 annual exclusion'; 'A gift is considered a present interest if the donee has all immediate rights to the use, possession, and enjoyment of the property'; 'each spouse must file a gift tax return if they have made a gift of property held by them as joint tenants or tenants by the entirety'; 'When To File': 'no earlier than January 1, but not later than April 15, of the year after the gift was made' · Checked October 31, 2026

4. According to the Instructions for Form 709, if you buy property with your own funds and title is held by you and another person as joint tenants with right of survivorship, and either of you may give up those rights by severing your interest, you have made a gift to that person of half the value of the property.

   Sources 2 · Instructions for Form 709 (2025), 'Joint Tenancy': 'If you buy property with your own funds and the title to the property is held by you and a donee as joint tenants with right of survivorship and if either you or the donee may give up those rights by severing your interest, you have made a gift to the donee in the amount of half the value of the property' · Checked October 31, 2026

5. According to the IRS, if you sell property that was given to you, the general rule is that your basis is the same as the donor's, and the rules are different for property acquired from an estate; the IRS gives the example of stock bought at $10 and sold at $100, with income tax due on a $90 gain.

   Sources 1 · Frequently asked questions on gift taxes, 'What if I sell property that has been given to me?': 'The general rule is that your basis in the property is the same as the basis of the donor'; 'if you were given stock that the donor had purchased for $10 per share ... and you later sold it for $100 per share, you would pay income tax on a gain of $90 per share'; 'The rules are different for property acquired from an estate' · Checked October 31, 2026

6. Under the federal Garn-St Germain law (12 U.S.C. §1701j-3(d)), on a loan secured by a home with fewer than five units, the lender may not exercise a due-on-sale clause because of, among others, a transfer in which the borrower's spouse or children become owners; a transfer to a relative resulting from the borrower's death; a transfer on the death of a joint tenant; a transfer to a spouse from a divorce or legal separation; or a transfer into a living trust in which the borrower remains a beneficiary; and the law lets regulations add other transfers to that list.

   Sources 3 · 12 U.S.C. §1701j-3(d): 'a lender may not exercise its option pursuant to a due-on-sale clause upon'; '(3) a transfer by devise, descent, or operation of law on the death of a joint tenant or tenant by the entirety'; '(5) a transfer to a relative resulting from the death of a borrower'; '(6) a transfer where the spouse or children of the borrower become an owner of the property'; '(7) a transfer resulting from a decree of a dissolution of marriage, legal separation agreement'; '(8) a transfer into an inter vivos trust in which the borrower is and remains a beneficiary'; '(9) any other transfer or disposition described in regulations' · Checked October 31, 2026

7. Under federal Medicaid law (42 U.S.C. §1396p(c)), if an institutionalized person or their spouse disposes of assets for less than fair market value on or after the look-back date, the person can be ineligible for Medicaid for certain services for a period; for transfers made on or after February 8, 2006, the look-back is 60 months; and there is no penalty if the home was transferred to the spouse, a child under 21 or blind or disabled, a sibling with an equity interest who lived there at least one year before the person entered the institution, or a son or daughter who lived there at least two years before and provided care that let the person stay home.

   Sources 4 · 42 U.S.C. §1396p(c)(1)(A): 'disposes of assets for less than fair market value on or after the look-back date'; 'the individual is ineligible for medical assistance'; (c)(1)(B)(i): 'in the case of any other disposal of assets made on or after February 8, 2006, 60 months'; (c)(2)(A): 'the assets transferred were a home and title to the home was transferred to— (i) the spouse'; '(ii) a child of such individual who (I) is under age 21, or (II) ... is blind or permanently and totally disabled'; '(iii) a sibling ... who has an equity interest in such home and who was residing in such individual's home for a period of at least one year'; '(iv) a son or daughter ... residing in such individual's home for a period of at least two years ... and who ... provided care' · Checked October 31, 2026

8. According to the California State Board of Equalization (BOE), Proposition 19, approved November 3, 2020, changed the property tax exclusion for parent-child (and grandparent-grandchild) transfers: the home must be the principal residence of both the transferor and the transferee, with a limit of the current taxable value plus $1,000,000 (adjusted every two years), and those changes have applied since February 16, 2021.

   Sources 5 · California State Board of Equalization, Proposition 19: 'On November 3, 2020, California voters approved Proposition 19'; 'PARENT-CHILD & GRANDPARENT-GRANDCHILD EXCLUSION'; 'Proposition 19 (Current Law) Principal Residence Principal residence of transferor and transferee Value limit of current taxable value plus $1,000,000 (as biennially adjusted)'; 'the changes to the parent-child and grandparent-grandchild exclusion became operative on February 16, 2021' · Checked October 31, 2026

9. According to the IRS, the VITA and TCE programs offer free basic tax return preparation to qualified individuals; the IRS does not set a program-wide income limit, though individual sites may set their own, and the program generally serves taxpayers who meet the Earned Income Tax Credit (EITC) income guidelines.

   Sources 6 · Free tax return preparation for qualifying taxpayers: 'offer free basic tax return preparation to qualified individuals'; 'While the IRS does not set a program-wide income limit, individual VITA sites may establish their own'; 'generally focuses on serving taxpayers who meet the Earned Income Tax Credit (EITC) income guidelines' · Checked October 31, 2026

10. According to the Legal Services Corporation, LSC is a nonprofit established by Congress to fund civil legal aid for low-income Americans; on its site you find a legal aid organization by entering your address or city, and LawHelp.org has information on legal questions and free forms.

    Sources 7 · I Need Legal Help: 'LSC is an independent nonprofit established by Congress in 1974 to provide financial support for civil legal aid to low-income Americans'; 'enter an address or city below to find an LSC-funded legal aid organization near you'; 'You can also visit LawHelp.org to look up information about your legal questions and find free legal forms' · Checked October 31, 2026