Life estate deed

[Kaybru20]

I would love to get a answer ASAP on a life estate deed my name is on..I am named remainderman on my sons dads life estate deed…I want to remove my name but don’t know if taxes will be involved? The house was quit claimed to me! Will my son’s dad or myself have to pay taxes if I quit claiming it back to him? We both agree on this but don’t know if  there’s any taxes involved?  I’m getting mixed answered, one said not sure, one said no because of a life-time excursions??  Can you help explain this Please?  We live in RI

[M-MTax]

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@Kaybru20 wrote:

We live in RI

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Rhode Island does not recognize Lady Bird (Enhanced Life Estate) deeds. As a result, the life estate that was granted to you was a gift (not taxable unless the lifetime exemption is exceeded, which Is $13.99 million per individual for 2025 gifts).

If you quitclaim it back to him (the grantor), that would be a gift as well (unless he pays full consideration for the transfer). You will not pay any income tax nor gift tax unless, with respect to the latter, you have exceeded your (unified) lifetime estate and gift tax exemption) but you will have to file a Form 709 if the value exceeds $19,000 for the tax year.