As I live in my mom's home with her, and my two brothers live out of town, a few years back, we went to a lawyer and changed the deed to put mom and I as joint owners. My brothers each live in a common law arrangement. I thought that this might be the best thing to do since I also lived in the home and could claim it as my principal residence. Thus, when mom died, I figured that the home would go to me along with mom's other investments, which are in both of our names, would pass to me without going through probate. Mom has always said that, upon her death, she wanted her total estate to be divided equally among all three of her sons and, as executor of her estate, that is what I will do. Her will states that everything is to be divided equallys but, aside from her RIF's and house contents, her house and investments are currently owned jointly by both of us.
In the current issue of MoneySense magazine, they state that you cannot avoid paying capital gains taxes by making a child a co-owner of your home. It goes on to say that "if you add a child's name to the title for your home, the CRA views that event (which we did ten or so years ago) as a taxable disposition of 50% of the house's value at fair market value. The capital gains taxes on that portion are due right away says Kathy Munro, a tax partner with PricewaterhousCoopers in Toronto.
This leads to a couple of questions:
Are there any positive reasons to having put this house, which we are both living in, in joint ownership on the deed?
Also, were any taxes actually due at the time that we made this change when the purpose of changing the deed was because the house was the principal residence of both of us and we thought that having it pass smoothly at the time of either of our deaths would save on probate costs?
Any other thoughts and/or advice would be appreciated. I would be pleased to provide further information if required.
Thank you for any help that you might provide.
In the current issue of MoneySense magazine, they state that you cannot avoid paying capital gains taxes by making a child a co-owner of your home. It goes on to say that "if you add a child's name to the title for your home, the CRA views that event (which we did ten or so years ago) as a taxable disposition of 50% of the house's value at fair market value. The capital gains taxes on that portion are due right away says Kathy Munro, a tax partner with PricewaterhousCoopers in Toronto.
This leads to a couple of questions:
Are there any positive reasons to having put this house, which we are both living in, in joint ownership on the deed?
Also, were any taxes actually due at the time that we made this change when the purpose of changing the deed was because the house was the principal residence of both of us and we thought that having it pass smoothly at the time of either of our deaths would save on probate costs?
Any other thoughts and/or advice would be appreciated. I would be pleased to provide further information if required.
Thank you for any help that you might provide.