Moving a Home Between Family Members: What We Tell Our Clients

We work a lot of family property questions — the Putnam County homestead that needs to go to a daughter, the Clay County house a parent wants to hand off before a move. The transfer itself is one recorded deed. The consequences run for decades. Below is the framework we walk clients through before anyone signs anything.

Matt Parham with his son in Palatka — Passing a home down is a family decision before it is a paperwork decision.

Three ways to move a home between relatives

Every intrafamily transfer in Florida ultimately rides on one of three instruments: a deed signed during life (usually a quitclaim), an enhanced life estate deed (the “lady bird deed”), or a revocable living trust. All three avoid probate. They differ sharply on taxes.

Strategy	Avoids probate?	Capital-gains treatment for the recipient	Florida doc stamp exposure	Typical use
Lifetime quitclaim deed	Yes — title moves now	Carryover basis: the recipient inherits the original purchase price as their cost basis	Taxed on any mortgage balance, even for a “$0 gift” (s. 201.02, F.S.)	Quick title changes between relatives
Lady bird deed (enhanced life estate)	Yes — passes at death, outside probate	Stepped-up basis to fair market value at death	Generally minimal on an unmortgaged home — confirm with the closing attorney	Passing a primary home to children while keeping full control
Revocable living trust	Yes — trust owns the home	Stepped-up basis to fair market value at death	Generally minimal on an unmortgaged home — confirm with the closing attorney	Larger or more complex estates needing conditions and control

Florida documentary stamp tax: the mortgage trap

Florida charges documentary stamp tax of 70 cents per $100 of consideration on deeds (s. 201.02, Florida Statutes). The trap: the statute counts the amount of any mortgage or other encumbrance as consideration, “whether or not the underlying indebtedness is assumed.” So gifting a home to a relative for $0 does not make the tax $0 if there's a loan on it.

Example. Deed a home carrying a $200,000 mortgage balance to a family member and the doc stamps are calculated on that $200,000 — $1,400 due at recording, gift or not. Deed the same home free and clear, structured properly as a gift, and the stamp exposure is generally minimal.

Two narrow exemptions worth knowing: s. 201.02(7) exempts transfers between spouses or former spouses of the marital home in a dissolution, and certain homestead transfers between spouses where the only consideration is the existing mortgage. Neither extends to transfers to children.

Federal gift tax: usually paperwork, not payment

Florida has no state gift tax. Federally, if the equity we shifts to any one person in a year exceeds the annual exclusion — $19,000 for 2026 (IRS) — a gift tax return (Form 709) must be filed. Because the lifetime exemption is far larger, families rarely owe tax out of pocket, but the filing itself is mandatory. A home transfer almost always crosses the $19,000 line.

The step-up-in-basis trap

This is where our strongest caution lives. Transfer the home during life by quitclaim and the recipient takes your original cost basis (“carryover basis”). Let it transfer at death — via lady bird deed, trust or will — and the recipient's basis steps up to fair market value on the date of death.

Hypothetical. A house bought long ago for $50,000 is worth $350,000 today. Quitclaimed during life and later sold at that price, the recipient reports roughly $300,000 of gain. Passed at death by lady bird deed or trust and sold at market value, the taxable gain is at or near zero. Same house, same family — radically different tax bill.

Two children and a dog sitting at the end of a long wooden dock — The deed you choose today decides what the next generation inherits — including the tax bill.

Homestead, Save Our Homes, and Medicaid

Two more reasons not to rush a lifetime deed. First, giving away ownership can end your homestead exemption and reset the Save Our Homes assessment cap for the new owner, which can raise the property-tax bill sharply. Second, an outright gift of the home starts Florida Medicaid's five-year lookback clock — a poorly timed transfer can delay eligibility for long-term-care benefits. An elder-law attorney should review any transfer where future care is a consideration.

Divorce, siblings, and other title changes

Not every intrafamily transfer is a parent-to-child gift. Two other patterns come up constantly:

Divorce (“dissolution”). When one spouse keeps the marital home, the departing spouse deeds their interest over — and if the deed is never recorded, both names stay on title, which surfaces years later at refinance or sale. Florida helps here: s. 201.02(7)(a) exempts marital-home transfers between spouses or former spouses in a dissolution from doc stamps, even with a mortgage.
Sibling buyouts after an inheritance. Three heirs inherit a house; one keeps it and buys out the other two. Money changing hands means the transfer is a sale for tax purposes — doc stamps on the consideration, and the selling siblings measure any gain from their stepped-up basis, which is why acting soon after the estate settles usually keeps the taxable gain small.

Whatever the scenario: the deed only works if it is recorded with the Clerk of Court in the county where the property is recorded (Palatka for Putnam County). The classic mistakes — wrong deed type, an unrecorded signed deed in a drawer, missed county forms — are exactly what a modest attorney fee prevents.

So which route fits?

Quitclaim during life — when the recipient needs ownership now and the basis and homestead consequences have been priced in.
Lady bird deed — when the goal is “the kids get the house when I'm gone” with no probate and no loss of control. Our full guide: the Florida lady bird deed, explained.
Revocable trust — when the home is one piece of a larger estate plan with conditions, multiple properties or blended-family considerations.

If your family is deciding between transferring the home and selling it, our team will put both paths on paper for you — no pressure either way.

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.

Sources

Section 201.02, Florida Statutes (2026) — documentary stamp tax rate and treatment of mortgages as consideration.
Florida Department of Revenue — Documentary Stamp Tax.
IRS — Frequently Asked Questions on Gift Taxes (annual exclusion, Form 709).

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.