Is it taxable to add my spouse to the title of my Israeli apartment?

The exemption covers a transfer made without payment between spouses. Because the receiving spouse takes over the original purchase date and cost, no new holding period starts and no gain is realized at the time of the transfer. For the single-apartment exemption, spouses are already treated as one family unit, so adding a spouse to title does not create a second qualifying seller. Both spouses sign a declaration to the Land Taxation Office, which issues the tax certificates needed to register the change at the Tabu. If one spouse pays the other, or the transfer involves taking over a share of the mortgage, the tax office may treat part of the transaction as a sale and assess tax on that portion.

The larger consequences are outside tax. A spouse added to title becomes a registered owner, which means both signatures will be needed for any future sale, mortgage or long lease. It also changes the position in a later divorce or inheritance, because a registered share is harder to dispute than a claim based on shared marital property. Banks usually need to consent before title to a mortgaged apartment changes, and some require the added spouse to join the loan. Couples who signed a property agreement should check that the transfer is consistent with it, because the tax exemption does not amend the agreement. For how reporting works in family transfers generally, see the guide on gifting property to family in Israel.

From the full guide: Betterment Tax (Mas Shevach) on Israeli Real Estate

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