Add owner to avoid probate?

iLOVEartLARK

Earning My Ears
Joined
May 17, 2016
This is actually a pretty complicated tax question. Its complicated even more if you just "add" them and don't transfer to them. It's not like you can just "add" your kid onto your 1M house and act like the gift occurs when you want it to. DVC is real estate.

I would never jointly own anything with a person I'm not married to, outside the structure of something like an LLC or trust. If I were buying blue card, I would absolutely go the LLC/trust route. The ease of those routes will vary depending on your home state and your estate plan.

As for OP, I'd be talking to a lawyer. This is even more complicated with all the complicated issues of the POA and the state assistance, which does have a lookback, if he ends up on Medicare. This is not where I would be taking internet legal advice.
I'm confused about "state assistance" and "if he ends up on medicare". He is currently on medicare, and is not receiving state assistance. Could you please explain? I'm absorbing as much of the advice I can, and hopefully helping out others in similar situations! Thanks for your input!
 

LadyBeBop

DIS Veteran
Joined
Feb 28, 2009
I'm confused about "state assistance" and "if he ends up on medicare". He is currently on medicare, and is not receiving state assistance. Could you please explain? I'm absorbing as much of the advice I can, and hopefully helping out others in similar situations! Thanks for your input!
It appears your father is already in a nursing home. In some localities, if his liquid assets (cash-on-hand, retirement funds) run out before he passes away, he would have to liquidate his assets. Which includes the DVC. And if any substantial gifts were made less than…I think it’s five years here in Kentucky, but it’s probably different elsewhere….prior to the time the funds dry up, the state can go after the gift receivers for the funds, before your father can go on assistance.

Definitely best to talk to an estate attorney.
 

mrsclark

DIS Veteran
Joined
May 16, 2013
I'm confused about "state assistance" and "if he ends up on medicare". He is currently on medicare, and is not receiving state assistance. Could you please explain? I'm absorbing as much of the advice I can, and hopefully helping out others in similar situations! Thanks for your input!
I think that poster was talking about if your dad ends up having to go on *Medicaid* in which case there is a look back period where they make sure he wasn’t giving away assets to qualify for Medicaid.

A trust will allow you to avoid probate while avoiding messing up on issues around gifting and Medicaid look back periods.

I am not an attorney though. I highly recommend consulting with one as these types of estate issues can get really complicated.
 

iLOVEartLARK

Earning My Ears
Joined
May 17, 2016
It appears your father is already in a nursing home. In some localities, if his liquid assets (cash-on-hand, retirement funds) run out before he passes away, he would have to liquidate his assets. Which includes the DVC. And if any substantial gifts were made less than…I think it’s five years here in Kentucky, but it’s probably different elsewhere….prior to the time the funds dry up, the state can go after the gift receivers for the funds, before your father can go on assistance.

Definitely best to talk to an estate attorney.
Oh, okay! He has enough money to live in the nursing home for a very long time, so that doesn't apply here. He is private pay, and will likely never be eligible for medicaid (which I now think is what RoseGold meant to say instead of medicare). Thanks for clarifying!
 

iLOVEartLARK

Earning My Ears
Joined
May 17, 2016
I think that poster was talking about if your dad ends up having to go on *Medicaid* in which case there is a look back period where they make sure he wasn’t giving away assets to qualify for Medicaid.

A trust will allow you to avoid probate while avoiding messing up on issues around gifting and Medicaid look back periods.

I am not an attorney though. I highly recommend consulting with one as these types of estate issues can get really complicated.
Wouldn't it be too late to establish a trust now that he is mostly non-communicative? Definitely not able to make decisions at this point.
 

mrsclark

DIS Veteran
Joined
May 16, 2013
Wouldn't it be too late to establish a trust now that he is mostly non-communicative? Definitely not able to make decisions at this point.
I am not sure if as POA you could still set up a trust with your mom but I would have to imagine that would be the case - that to me seems the much cleaner way to do it, legally, but again I am not an attorney just someone with a strong interest in personal finance. An estate attorney would know for sure.
 

Rex1993

Earning My Ears
Joined
Aug 13, 2021
I am an estate/tax attorney. You appear to have a fairly good grasp of some of the issues but this can often lead to more harm than good. Your series of posts indicate you definitely need qualified help. I've had too many occasions where I've had to clean up situations where people thought they knew what they were doing and made a mistake that ending up costing 100X the cost of the legal advice that would have avoided that outcome in the first place.
 

Rex1993

Earning My Ears
Joined
Aug 13, 2021
Our of curiosity, how is the value of “gifting” DVC ownership calculated? The cost of the points when I bought it? The cost now? This is not on my radar now, but my youngest turns 18 in 3 years, and once both boys are through college and/or moved out, we were considering adding them to our membership (so that our contracts will go to them when we pass to use or sell as they wish, but also so they can use it and have access to direct perks like AP discounts).
The amount of the gift is determined at the time of the gift. For a DVC contract, you will really need an appraisal to satisfy the adequate reporting requirements for the 709 gift tax return.
 

ldo

DIS Veteran
Joined
Apr 13, 2007
The amount of the gift is determined at the time of the gift. For a DVC contract, you will really need an appraisal to satisfy the adequate reporting requirements for the 709 gift tax return.
If one does not want to pay for an appraisal, I'd think market comps of resales would suffice. It's quite easy to look up sales records from Orange county and back-end calculate the sales price from the deed tax. I did it using this helpful post:
https://www.disboards.com/threads/viewing-resales-on-oc-comptroller-website-and-rofr.3516339/
 

Anthony Vito

DIS Veteran
Joined
Jan 16, 2017
Many POA documents contain a statement that the authorized person may not make gifts to himself or anyone he/she is obligated to support. You may have to have both of your parents sign the paperwork to add you to the deed. If you have siblings, there may be other complications/challenges later on.

You might also investigate establishing a revocable living trust for them. These can be very helpful to those who own property in more than one state.

I'm going through something very similar right now. It's hard to see your parents slowly decline. Good luck to you.
Something I've wondered with this - for anyone who has a revocable trust with DVD titled in it - how does Disney handle DVC contracts titled in the trust? I know I've seen somewhere that the annual dues are higher if it's titled in a corporation (i.e., LLC). Do they do this with trusts as well? Also, how does it work for purposes of determining "owners" - perks, reservations, etc.? I can't imagine they'd allow all beneficiaries to be "owners," but would they consider primary beneficiaries, etc.?
 

ronw

Mouseketeer
Joined
Apr 12, 2000
I believe the trustee is treated as the owner. Beneficiaries don't matter except for the successor trustee upon death of the original trustee.
 

RoseGold

DIS Veteran
Joined
Jan 21, 2020
I know I've seen somewhere that the annual dues are higher if it's titled in a corporation (i.e., LLC). Do they do this with trusts as well? Also, how does it work for purposes of determining "owners" - perks, reservations, etc.? I can't imagine they'd allow all beneficiaries to be "owners," but would they consider primary beneficiaries, etc.?
I have no idea where this rumor came from. Dues are based on number of points. Closing or title or paying to set this up might be more complicated, for obvious reasons.

The LLC makes anyone on the board a member.

The trust makes the trustees members (maybe also beneficiaries??) Both trusts and LLCs could also add “associates” like an individual membership.
 

iLOVEartLARK

Earning My Ears
Joined
May 17, 2016
I have decided to deal with this after my dad passes, and it belongs to just my mom. Then she can add me through one of the Florida title transfer companies, like LT Transfers. I am still enjoying reading your responses though! Thanks!
 

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