§ 15104.50. Transfer Between Spouses of Real Property Owned by Husband and Wife in Joint Tenanc...
18 CA ADC § 15104.50Barclays Official California Code of Regulations
18 CCR § 15104.50
§ 15104.50. Transfer Between Spouses of Real Property Owned by Husband and Wife in Joint Tenancy Created on or After September 11, 1957 and Before January 1, 1981.
If a joint tenancy between husband and wife is created on or after September 11, 1957 and before January 1, 1981, either by one spouse alone or by both spouses, and, pursuant to Revenue and Taxation Code Section 15104.5, then in effect, the donor does not elect to have the creation of the joint tenancy treated as a transfer by gift, and thereafter the joint tenancy is changed to some other form of ownership prior to January 1, 1981, the donor spouse shall be deemed to have made a transfer by gift to the extent that the proportion of total consideration furnished by such spouse multiplied by the value of the property at the date of terminating the joint tenancy exceeds the value of the interest retained by such spouse.
If the joint tenancy is created with community property each spouse contributes one-half of the community property and the transfer or conversion of the community property into the joint tenancy between the spouses is not deemed a transfer by gift (see Section 15104.2).
If the joint tenancy between husband and wife, created on or after September 11, 1957, is changed to some other form of ownership after January 1, 1981, the change in the form of ownership comes within the marital exclusion pursuant to the provisions of Revenue and Taxation Code Section 15310, as amended and effective January 1, 1981, and no gift tax is due.
This regulation may be illustrated by the following examples:
EXAMPLE (1). In 1960, husband transfers his separate real property, having a value of $25,000, to himself and wife, as joint tenants. Husband does not elect to have the transfer treated as a gift. In 1975, husband and wife enter a community property agreement, changing the joint tenancy to community property. Husband has made a gift to wife of one-half the value of the property at the date of the community property agreement.
EXAMPLE (2). In 1960, husband transfers his separate real property, having a value of $10,000, to himself and wife, as joint tenants. Husband does not elect to have the transfer treated as a gift. Thereafter, the real property is improved with community property funds in the amount of $20,000. The property is subsequently sold for $60,000, and husband and wife hold the proceeds of sale as community property.
Husband has furnished two-thirds consideration for the joint tenancy property ($10,000 separate and $10,000 community), and he has retained a one-half interest in the proceeds from the sale of the property. Husband has made a gift to wife of $10,000 [$40,000 ( 2/3 x 60,000) - 30,000 ( ½ x 60,000) = $10,000].
EXAMPLE (3). In 1960, husband transfers his separate real property, having a value of $20,000, to himself and wife, as joint tenants. Husband does not elect to have the transfer treated as a gift. Thereafter, the real property is improved with community property funds in the amount of $15,000. The property is sold in 1981 for $85,000, and husband and wife hold the proceeds of the sale as community property. The transfer from the husband to the wife comes within the marital exclusion pursuant to Revenue and Taxation Code Section 15310, as amended and effective for gifts made after January 1, 1981, and no gift tax is due.
Credits
Note: Authority cited: Section 16506, Revenue and Taxation Code. Reference: Section 15104.5, Revenue and Taxation Code.
History
1. Amendment filed 7-2-81; effective thirtieth day thereafter (Register 81, No. 27).
This database is current through 6/14/24 Register 2024, No. 24.
Cal. Admin. Code tit. 18, § 15104.50, 18 CA ADC § 15104.50
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