How Best To Pay Down Our Liquid Assets?

by Betty
(Burns, Tn.)

We have one child, an unmarried son. Our house and land are valued at less than $400,000. We want to deed the home over to him with Life Estate privileges. Also, we want to pay down our liquid assets by gifting him $13,000 per year.

We plan for this money to be placed in a special bank account in his name only and with us signing a signature card in case something unforseen happens to him. We would have all rights to do as we please to the property as long as we live.

Does this sound feasible as a good plan?

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Jul 31, 2011
by: Mo Johnson

I'm not sure why you want to do this. Are you concerned about estate taxes?

As for gifting $13,000 a year -- that will work fine, but to qualify as a gift you will have to relinquish all control of it.

Aug 01, 2011
pay down liquid assets
by: Betty

What would be the difference in adding our names to signature cards on his account that was gifted to him than having each other's names on our checking and savings accounts now? We are the sole beneficiaries of his estate and he is the sole beneficiary of ours. Tell me what the law is in Tn. that would make my idea a bad one. The gift would simply be on paper anyway.

Aug 03, 2011
You have to give up control of it
by: Mo

I'd say if you can still access the money then you haven't given up control and it would not be legally considered a gift. But, you need to check with a Tennessee lawyer for the specific law there.

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