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Although your dad qualifies for up to $250,000 tax-free profits, you can't qualify because you don't meet the 24 out of last 60 months occupancy test. Therefore, about $150,000 of that capital gain will be taxable.

PROPERTY RECORDS ARE NOT A PRIVATE MATTER

DEAR BOB: At age 73, I recently refinanced my reverse mortgage. Since then I am being bombarded with letters from insurance companies wanting to sell me disability insurance. I am infuriated by these companies invading my privacy. Also, the appraiser came from an area a considerable distance away. How can he know property values in my town? The reverse mortgage lender didn't use one local company, except the termite inspector. The lender's title insurance came from out of state. What can be done about this invasion of my privacy? --Marilyn G.

DEAR MARILYN: Most recorded documents are public information. The reason is many people, such as mortgage lenders and title insurers, need to know what liens and other recorded documents affect your property.

There are nationwide companies that make "big bucks" obtaining recent public records, such as your reverse mortgage recording, and selling that information to insurance companies and other users. Because public records are not private, there is nothing you can do but throw away the junk mail you don't want.

MOTIVATED HOME SELLER RAISED COMMISSION TO SELL HOME

DEAR BOB: Thanks for that item a few weeks ago from a Realtor who got her seller to raise the sales commission to 7 percent and then sold the house that had languished on the market. As my home is listed for sale, I showed that article to my Realtor. I think he is doing a great job, but the local "buyer's market" is saturated with too many homes in my price range. My listing has about 40 days remaining so I said "Let's raise the commission to 7 percent with 4 percent to the buyer's agent." He thought I was crazy, but I convinced him I really need to sell my house. So he and his broker heavily promoted my house to the local MLS (multiple listing service) agents with a re-tour, deli-lunch (Realtors love free food), weekend open houses, newspaper ads, etc. Within 10 days, I received two good purchase offers. I accepted the best one and kept the other as a back up. Just thought you should know raising the commission really works --Cindy R.

DEAR CINDY: That item a few weeks ago resulted in many positive letters from realty agents. But there were a few negative letters from penny-pincher cheapskate home sellers who said "Why didn't the Realtor work as hard when the house had a 6 percent commission?"

They didn't understand the purpose of raising the sales commission is to attract the attention of buyer's agents to get them to show your home rather than another one to their prospects. In the current buyer's market, the success key is getting your home seen by as many buyer's agents and their prospects as possible.

REMAINDERMAN HAS NO DUTY TO MAINTAIN HOME

DEAR BOB: I am perplexed at your answer to stepchildren whose stepmother holds a life estate in their late father's property. If the stepchildren will inherit the house after the stepmother dies, shouldn't they help pay for its upkeep? Most widows live on fixed incomes and often can't afford to maintain the property. I think you need to think this through from the perspective of the second wife who probably took care of the ill father. Why should she spend her money for her stepchildren's inheritance? --Muriel O.

DEAR MURIEL: You make a lot of sense. However, the law of every state with which I am familiar says a life tenant must pay the property taxes, mortgage payments (if any), and the maintenance.

The remainderman has no legal duty to help pay for maintenance. If the life tenant allows the property to go to "waste," the remainderman can have the life estate terminated.

But there is no reason why the terms of the life estate could not require contributions by the remainderman to help maintain the home while the life tenant lives in it. Such a document should be carefully drawn to prevent administrative problems.

THIS SOUNDS LIKE A FAMILY SCAM

DEAR BOB: My niece wants to buy my house without getting a mortgage. She wants me to sign the house over to her. Then she will get it refinanced and pay me my asking price. I will continue living in the house while this plan is pending and I will get my money in three months if all goes well. If not, she will deed the house back to me. Is this risky or just plain dumb? I am a widow and the house is too much for me to keep up --Valerie J.

DEAR VALERIE: This could be a family scam. If your niece can qualify for a mortgage, she should do so without you first deeding the house to her.

You could agree, for example, to sell the house to her with an 80 percent lender mortgage and you can carry back a second mortgage for the balance of the sales price.

There's no advantage for you to deed your house to your niece without receiving cash or at least a first mortgage from her for your security. Please consult a local real estate attorney to get everything in writing. Somehow, I just don't trust that niece.

COSTLY DISADVANTAGES OF A GIFT DEED

DEAR BOB: Why don't you warn people about the dangers of gift deeds? My mother was diagnosed with terminal cancer. I am her only offspring. She wanted to gift deed her house and two rental properties to me to avoid probate after her death. Her attorney prepared the gift deeds and I recorded them. Little did I know how costly that would be. A few months later I received notices from the county tax assessor that the properties would be reassessed. At the very least, this will result in several thousand dollars higher annual property tax. But the bigger surprise is the cancer diagnosis was wrong. My mother has another disease (the name is too hard for me to remember) but it now looks like she will live for many years. Even if I deed the properties back to her, the tax assessor says he will still reassess them --Todd W.

DEAR TODD: You left out a much greater disadvantage of a lifetime gift deed. Because you received those properties as lifetime gifts, you took over your mother's low adjusted cost basis. If you had instead inherited those properties, you would have received a new "stepped-up basis" to market value on the date your mother passes on.

When you eventually sell those properties you will have a large taxable capital gain most of which could have been avoided by instead inheriting those properties.

Your mother meant well to avoid probate, but she could have kept ownership, given you a stepped-up basis, and avoided probate by use of a living trust. Details are in my special report "24 Key Questions: Living Trust Secrets Reveal How to Avoid Probate Costs and Delays" available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.