Introduction
Gifting real estate in California is a practical way to transfer property to family members or loved ones without selling it. Whether you’re passing down land, a home, or investment property, gifting can help avoid probate and simplify estate planning.
In this guide, we’ll cover:
- What it means to gift real estate
- Legal steps to transfer property as a gift
- Tax implications (state and federal)
- When gifting makes sense vs. selling or inheriting
Let’s explore how to gift real estate in California the right way.
What Does It Mean to Gift Real Estate?
Gifting real estate means transferring ownership of a property without receiving payment in return . This is often done between parents and children, siblings, or other close relatives.
The process involves changing the title deed and recording it with the county recorder’s office.
Step-by-Step: How to Gift Real Estate in California
Step 1: Confirm Ownership and Title Status
Make sure you have clear ownership of the property and that there are no liens or disputes.
Step 2: Consult a Real Estate Attorney
Get legal advice to ensure compliance with state and federal laws.
Step 3: Prepare a New Deed
Use either a Quitclaim Deed or Grant Deed to transfer ownership.
Quitclaim Deed : Most common for gifting; transfers whatever interest you have in the property.
Step 4: File the Deed With the County Recorder
Submit the new deed to the County Recorder’s Office where the property is located.
Step 5: Update Title Insurance and Taxes
Notify your title company and local assessor about the change in ownership.
Step 6: Consider Mortgage Implications
If the property has a mortgage, check with the lender—some loans include a “due-on-sale” clause that may be triggered by a gift transfer.
Types of Deeds Used for Gifting Property
| Quitclaim Deed | Most common for gifting property between family members |
| Gift Deed | Not required in California, but sometimes used to clarify intent |
| Interspousal Transfer Deed | For gifting property between spouses or domestic partners |
Always work with an attorney to choose the correct form and ensure proper filing.
Tax Implications of Gifting Real Estate in California
California does not impose a state gift tax , but federal gift tax rules apply .
Key Points:
- Federal Gift Tax Exclusion (2025) : You can gift up to $18,000 per person annually or $32,000 to a couple without triggering taxes.
- Larger Gifts : Must be reported on IRS Form 709, though tax is rarely owed due to high lifetime exemption ($13.61 million in 2024).
- No Change in Property Taxes : Under Proposition 19, most gifts between parents and children qualify for property tax reassessment exemptions if properly filed.
Tip : Always file a Claim for Reassessment Exemption (Form BOE-58-H) when transferring property to a child or grandchild.
Parent to Child Property Transfers
Transferring property from parent to child is one of the most common forms of gifting in California.
Benefits:
- Can avoid full property tax reassessment
- Helps with estate planning and asset protection
Requirements:
- File Form BOE-58-H with the county assessor within 3 years of the transfer
- The recipient must use the property as their primary residence (for full exemption)
Gifting vs. Inheriting Real Estate
| Property Tax Reassessment | May keep original base year value if qualified | |
| Capital Gains Tax Basis | Recipient inherits original cost basis (can mean higher capital gains later) | |
| Control | Donor loses ownership immediately | Retain ownership until death |
| Medi-Cal Eligibility | May impact eligibility if gifted within 30 months of applying | No impact unless assets exceed limits |
Talk to an estate planning attorney to decide which option is best for your situation.
Is Gifting Real Estate Right for You?
Gifting Makes Sense If:
- You want to pass property to heirs early
- You’re reducing estate size for tax planning
- You’re helping a family member build equity
Think Twice If:
- You still need the income or equity from the property
- You rely on Medi-Cal or plan to in the future
- You’re unsure about long-term financial security
Checklist: Steps to Gift Real Estate in California
✅ Confirm clear title and ownership
✅ Decide on type of deed (Quitclaim or Grant)
✅ Draft and notarize the deed
✅ File with County Recorder’s Office
✅ Submit BOE-58-H if transferring to child/grandchild
✅ Notify lender if property has a mortgage
✅ Consult a CPA or attorney to understand tax impact
Conclusion
Gifting real estate in California is a powerful estate planning tool—but it requires careful planning and legal guidance.
Whether you’re transferring a family home, investment property, or vacation land, understanding the tax implications , deed types , and county requirements ensures a smooth and compliant transfer.
Always consult a real estate attorney and tax advisor before making any property gift.
Frequently Asked Questions (FAQs)
Q: Can I gift my house to my child in California?
A: Yes—and you can often keep the original property tax base if you file Form BOE-58-H.
Q: Do I have to pay taxes if I receive a property as a gift in California?
A: California doesn’t charge gift tax, but federal rules apply depending on the value.
Q: Can I gift rental property in California?
A: Yes, but recipients will take over the current tax basis, which could affect future capital gains taxes.
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