This is a mistake that many people make as they think that it will help to make things easier once they pass away. The issue is that if the child is added to the property before the parent’s passing, the child’s basis in the property becomes the parent’s basis in the property from when they originally purchased the property. For example, if a parent purchases a property for $100,000 in 1990, adds their child in 2020, and the parent passes away in 2025 and the fair market value of the property is $800,000, when the child goes to sell it, they would be taxed on the $700,000 capital gains. If the home transfers to the child at the time of the parent’s passing, the child’s basis would be $800,000, so there would be no capital gains tax needed to be paid.