I. QUESTION PRESENTED What is the impact of Mr. Roberts and Ms. Turley holding their new home as joint tenants in a community property state? II. SHORT ANSWER By opting to hold the new home as joint tenants in a community property state, the couple will realize the higher level of creditor protection afforded by a joint tenancy but will lose the significant tax benefits afforded under the community property tax regime. III. STATEMENT OF FACTS John Roberts and Alice Turley are going to be married in the near future. They currently reside in a home solely owned by Mr. Roberts but plan to purchase a new $300,000 home after they are married. They currently live in a community property state and have decided that they wish to title the property …show more content…
Impact of Joint Tenancy in Community Property State Mr. Roberts and Ms. Turley are currently seeking to title their new residence as a joint tenancy in a community property state. This will provide them with the marginally superior creditor protection discussed above, with creditors of either spouse only being able to receive half of the property. While creditor protection may be stronger for this form of property ownership, it also allows either spouse to freely transfer their interest in the property and sever the joint tenancy without the consent of the other spouse. Opting to hold the new home as joint tenants instead of through a traditional community property structure will lead to negative consequences upon the death of the first spouse. To express this consequence we will analyze the different results assuming that five years have passed and the value of the home has increased to $450,000. In both forms of property ownership, each spouse will hold a half interest in the home with a value of $225,000 and a basis of $150,000. When one spouse dies holding this interest, the other will receive the entire interest with a higher basis. When the property is held as joint tenants, only the half that is held by the deceased spouse will receive a “step-up” in basis. This will leave the surviving spouse with property with a value of $450,000 and a tax basis of $375,000. When the property is held as community property, the entire property will receive a step-up in basis as …show more content…
Mr. Roberts and Ms. Turley should consider holding the property under the general principles of community property instead of attempting to hold the property at joint tenants. This will allow them to realize the large tax benefit provided for spouses under the community property regime. If Mr. Roberts and Ms. Turley live in a state where community property with a right of survivorship is recognized, they could utilize this form of property ownership to recognize the “best of both worlds.” James Ratner, Community Property, Right of Survivorship, and Separate Property Contributions to Marital Assets: An Interplay, 41 Ariz. L. Rev. 993
8) If the ownership and use test has been met or the exclusion has already been taken with the past two years, the taxpayer may qualify for a reduced gain exclusion. 9) Tax rules vary for personal-use, rental, or dwelling units used as home property, which is determined based on the number of days rented versus the number of personal use days. 10) Although the gain exclusion can be advantageous and residence automatically qualify if the necessary tests are met, the taxpayer may want to elect out if they anticipate the sale of another home (that would also qualify) to yeild a larger
Because they considered the house as a rental property, Rachel and Brad filed their tax return and deducted the maintenance expenses, depreciation, and
Discussion Board Forum 2 Case Study Martin has decided to retire after he spent many years as a deputy police officer in a small town in North Carolina and as a detective in Raleigh. During his years as an officer of the law and order, he deiced to invest in some properties in the state. One of the properties is in the blue ridge mountains in North Carolina and the other real estate is on the North Carolina coast. The real property at the mountain was purchased 31 years ago as a joint tenancy with a right of survivorship with his friends. The second property located on the North Carolina coast is been taken by eminent domain by city authorities to make space for new development and business around the area.
Mark the right option followed by entering the name of the person in the appropriate space in the section 6, Consent by Person with Right to Designate Primary Residence. Findings, section 7 requires selection of one choice by the judge among three listed there about the acceptance or refusal of the
For example, while both spouses are alive, both parties must consent to the transfer of the community property. In addition, the annual gift exemption can be combined and fully applied (since there is equal ownership), allowing for the spouses to receive the maximum exclusion for gift transfers (Leimberg, Shenkman, Katz, Kandell, & Miller, 2015). In contrast to the requirement for consent, upon death a spouse may transfer their share in the property as they see fit, however it is often transferred to the spouse. Topic #3: Wills Question #1: What happens if you do not have a will?
Name of case: Reed v. King Court: California Court of Appeals Citation: 193 Cal. RPTR. 130 (1983) Parties & their roles: Dorris Reed (Plaintiff/petitioner); Robert King (Respondent/defendant) Facts: Dorris Reed purchased a home from Robert King; Mrs. Reed paid $76,000 for this property. Mrs. Reed found out from her neighbors once she had moved in, that Mr. King failed to disclose that ten years earlier a mother and her four children had been murdered in the home. She also learned the house carried a stigma due to its history, which causes appraisers to evaluate the true worth of the home to be $65,000.
In our case Hawthorn was entering the apartment of his ex-fiancé. This relationship with the current occupant does not help establish an absolute right. In fact, Hawthorn’s relationship with Evergreen, his ex-fiancé, is significantly weaker than the estranged marriages found in both Sears and Davenport. Because estranged marriages were not enough to establish an absolute right, there is even less of a chance that Hawthorn’s broken off engagement would grant him an absolute
This memorandum is written in response to your September 1, 2015 request for information regarding the case of Samuel V. Morgan. The analysis will show that Samuel is liable to pay the fine. Robert is a senior weight lifter and member of the Alpha Chapter, Beta Phi Gamma Fraternity, Inc. at Howard University. Although he is strong, he is extremely slow moving which forces him to limit himself to fighting with people who are considerably smaller than he.
In Turner v. Safley (1987), the Supreme Court ruled in favor of restricting prisoners Constitutional rights. According to the ruling, the restriction of rights is Constitution if “reasonably related to legitimate penological [i.e. safety] interests.” Jeffs communicates sermons and regulations from prison, and limiting the community between Jeffs and the hierarchy of Short Creek attempts to severe ties between Jeffs and the FLDS. Satinder Singh, an ACLU attorney, said “…prisoners can limit communication, including mail and visits….However, the prison can’t suppress Jeffs free speech rights just because it doesn’t like what he has to say (Singh).” While Jeffs ideologies continue to dictate the infrastructure of Short Creek, minimizing communication enhances the chances of stopping the theocratic rule in Short Creek.
Ophelia no longer had any right to the property as her marriage was invalidated and categorized as “illicit sex.” The goal of the miscegenation laws was to keep property within the white race. Regardless of Ophelia being with Fred for 30-years she was not entitled to anything. Furthermore “The couple had used Ophelia’s earnings, combined with her proceeds from government payments to Tillamook tribal members, both to purchase the property and to pay the yearly taxes on it.”
The main reason for the unanticipated selling of her home was because the deed
Our founding fathers knew it best when it came to the importance of private property, James Madison said, “Property rights are as important as personal rights, because the two are so intimately connected.” I will present to you why property ownership is continuously considered a beneficial idea by giving examples of its emotional, financial, and social benefits. First, I believe the American Dream is still very much alive today. We as humans have that deep-seated yearning to have our own place to call home.
Case Brief Case Information The United States Supreme Court decided Missouri v. Galin E. Frye on March 21, 2012. Case Facts In August of 2007, defendant Galin E. Frye was charged with driving with a revoked license; he had already been convicted three times for the same offense and Missouri charged him with a class D felony, which carries a maximum prison term of four years.
In the final paper we are going to delve into what forms a married couple will need to file their taxes jointly. Harold and Sarah are a married couple with a daughter named Tara. They choose to file their taxes jointly this year using form 1040. This form has a total of 79 lines that they will need to consider and fill in with their previous year information. In this scenario I am going to be completing the 1040 form for the couple, so I am going to go through the steps I took to complete it for them in its entirety.
Residential Tenant -they are the ones who uses up the realty as their home, thus the word “Residential” This law protects the residential tenant from forced and unannounced entry of the landlord. To make sure that the property