Various costs will determine best time to convey home

Q. I own a home with an in-law apartment, in which I live. My daughter and her family live in the rest of the house.

In the future I would like to take my name off the deed and put only my daughter's name on it as owner. Because they live here, it makes sense to do so and maybe save a lot of rigmarole down the road after I die.

How hard or easy is this? Will she (or me) have to pay a lot of money just to transfer the deed to her? I know a lawyer and some fees will happen.

A. Transferring ownership is a simple matter, particularly if you own the place free and clear. Local practices vary. In New York state, for example, you ask a lawyer to write a new deed naming your daughter as owner. The title - ownership - transfers the moment you sign it. The deed should then be put on file in your county public records office.

That's all. None of this should be expensive, and you can always ask the lawyer in advance what it will cost.

You may also, though, want to consider the question of your daughter's eventual income-tax liability if she were to sell the house someday.

If she waits to inherit it, she'll receive it with a new stepped-up cost basis, the value at the time of your death. But if she gets it now as a gift, which is what you ask about, then she takes over your present cost basis.

There's no way I can tell what that is. Your mention of the in-law apartment makes me wonder if you ever rented that space out and whether this affected your cost basis. Have you owned the place for a long time? Did you get a stepped-up basis yourself when your husband died?

And if you receive a veteran discount on property taxes or a modest-income senior discount, she probably couldn't use that.

It may be worth a session with a CPA - a certified public accountant - who can consider all the figures and advise whether your daughter is better off taking ownership now or waiting.

Q. With regard to the reader question in a recent column regarding a backup sales contract, perhaps I missed something, or maybe rules have changed.

Many years back, I made an offer on a local home for sale that had an accepted offer contingent on the prospective buyer selling his current home. I offered full price with no contingency. The existing contract apparently allowed the owners to give the first prospective buyer five business days to find financing, or my offer could take precedence. I ended up with the house.

Would it be illegal or unethical to offer money to a would-be first purchaser to withdraw his offer if it is agreeable with him and the owner?

Obviously, the new offer should be cash or non-contingent with a handsome down payment. That could even be attractive to the first prospective buyer if there is any ambivalence about the house.

A. You didn't miss anything, and no, the rules haven't changed.

Your good fortune was that the existing contract was what is known as contingent. It wasn't quite a firm "I'll buy" because it included an "only if." It was contingent (dependent) on the sale of the would-be buyer's present home.

The sellers evidently included a clause requiring that first buyer to "put up or drop out" if ever challenged, and that was when your offer came along. The would-be buyer was given five days to firm up his offer, promising to buy whether or not his present house was sold. Evidently, he couldn't - or wouldn't - do that, so he had to drop out. That was your good fortune.

As for your second question about offering the accepted buyer money to drop out, he wouldn't have an offer he could withdraw. He'd have a contract to buy, and he'd be bound by it. If he wanted to drop out so that you could buy, he could only do so - as you realize - if the sellers agree to release him.

Q. We have an investment in a condo and wonder if the homeowners association has the right to select the type of window replacement without any input from us, the condo owners?

A. Get out the condo agreement you signed when you first moved in, and read some of the fine print. You probably agreed that the homeowners association has the right to make decisions about your building exterior. The condo association itself probably owns the building(s) and wants to keep the outside appearance uniform.

• Contact Edith Lank on www.askedith.com, or 240 Hemingway Drive, Rochester NY 14620.

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