Family Transfers and Inherited Houses: Know the Rules Before You Sell

A lot of the houses we buy came to their owners through family — a deed from Mom, an inheritance, a quitclaim signed years ago. How the house reached you controls what taxes you'll owe when you sell it. Before you take any offer, ours included, understand which of the three transfer routes below applies to your title, because the difference can be tens of thousands of dollars in capital-gains treatment.

What an intrafamily transfer actually is

An intrafamily deed transfer changes who owns a property without a sale on the open market. The house doesn't move; the deed — the recorded legal document that says who owns it — gets updated. A parent gifts a home to an adult child. A spouse comes onto title after a wedding, or off it after a divorce. Siblings sort out an inherited house. Same walls, new names.

Who these transfers happen between

• Spouses. Adding a new spouse to title, removing one after a divorce, or retitling during a refinance.
• Parents and children. Gifting a home during life, or passing it at death through a lady bird deed, trust or will.
• Siblings. Usually after an inheritance — one keeps the house, the others deed their shares over, often for a buyout payment.

What “dissolution” means for a title

Dissolution just means a legal relationship ending — a marriage, a partnership, or co-ownership between family members. The property doesn't vanish; the ownership arrangement changes, and the deed has to catch up. This is the step families skip: a spouse moves out, an heir walks away, but the title never gets updated. Years later the house can't close because someone who left in 2019 is still legally on the deed. If the deed isn't recorded with the Clerk of Court in the county where the house is recorded, on paper nothing changed.

The three instruments, compared

The taxes: what each route costs

Florida doc stamps — the mortgage trap

Florida charges documentary stamp tax of 70 cents per $100 of consideration on deeds (s. 201.02, Florida Statutes) — and the statute counts any mortgage balance as consideration, “whether or not the underlying indebtedness is assumed.” A “$0 gift” of a home with a $200,000 loan on it owes stamps on the $200,000: $1,400 at recording. A free-and-clear home gifted cleanly generally records with minimal stamps. One narrow break: s. 201.02(7)(a) exempts marital-home transfers between spouses or former spouses in a divorce.

Federal gift tax — paperwork, rarely payment

Florida has no gift tax. Federally, equity shifted to one person above the annual exclusion — $19,000 for 2026 (IRS) — requires filing Form 709. The large lifetime exemption means tax is rarely owed out of pocket, but the filing is mandatory, and a house almost always crosses the line.

Capital gains — the one that decides what you net

This is the piece we check on every family-transferred house we look at. Got the house by lifetime quitclaim? You inherited the giver's original cost basis — sell a house bought decades ago for $50,000 at $350,000 and roughly $300,000 of that is taxable gain. Got it at death — lady bird deed, trust, will? Your basis stepped up to fair market value on the date of death, and selling near that value means little or no taxable gain. Same house, opposite outcomes.

Homestead, Save Our Homes, and Medicaid

A lifetime transfer can also end the giver's homestead exemption and reset the Save Our Homes cap — a property-tax spike for whoever holds title next — and an outright gift starts Florida Medicaid's five-year lookback clock. If long-term care is anywhere on the horizon, an elder-law attorney belongs in the conversation before anyone signs.

How a transfer gets done, step by step

1. Pick the right instrument. Quitclaim for a now-transfer with the consequences priced in; lady bird deed for “at my death, no probate”; trust for complex estates.
2. Have an attorney draft it. Names, legal description and ownership form have to be exact — a misspelled name or wrong legal description can cloud the title for years.
3. Sign with Florida deed formalities. Notary and witnesses, done properly.
4. Record it with the Clerk of Court in the county where the house is recorded. An unrecorded deed in a drawer changes nothing on the public record.
5. File the follow-up paperwork. Doc stamps at recording, Form 709 if it's a reportable gift, and any property-appraiser filings.

Before you sell a family-transferred house

If you already own a house that came through family — deed, inheritance, or an old quitclaim — two checks before you take any offer, ours included: pull the deed history so you know exactly how and when title reached you (that sets your basis), and confirm everyone who needed to sign off actually did. We do both on every house we evaluate, and we'll show you the open-market number next to our cash number either way.

If the house has already passed to you and you'd rather have certainty than a listing, we'll make a documented cash offer and you can compare it against the open market — we show both numbers.

Frequently asked questions

Can I just quitclaim my house to my child in Florida?

You can, and the deed itself is simple. But if the home carries a mortgage, documentary stamp tax is due on the loan balance under s. 201.02, Florida Statutes, and your child inherits your original cost basis, which can create a large capital-gains bill when they sell. Most families are better served comparing a lady bird deed or trust first.

Do I owe gift tax if I give my house to a relative?

Florida has no gift tax. Federally, a gift above the $19,000 annual exclusion (2026) requires filing IRS Form 709, but because of the large lifetime exemption, tax is rarely owed out of pocket. The filing is still mandatory.

Will transferring my home affect my property taxes?

It can. A lifetime transfer can end your homestead exemption and reset the Save Our Homes cap for the new owner, raising the assessed value to market. Transfers that complete at death, such as a lady bird deed, leave your homestead treatment in place during your life.

This guide is educational information for Florida homeowners, not legal or tax advice. Deed drafting, Medicaid planning and gift-tax filings are attorney and CPA work — please engage a Florida estate or elder-law attorney before signing or recording anything.