is it better to transfer ownership of a house to your children or leave it in a will?

I have to agree, the best instrument for transfering ownership is going to be an revocable living trust, the only reason you wouldn't want to do this is if you think that the family will fight with each other over the inheritance, in that case having the state go through probate can act as a mediator and make sure that the matter is resolved fairly.

The reason probate is usually not the best option, is that it has expensive fees (4%-10% of gross estate) takes 8-18 months, and is a very public process. Consult with an estate attorney to discuss the benefits of setting a trust up.

If your only concern is taxes, then there really is no difference between transferring now, or devising via a will. There is a "gift tax," but there is a huge lifetime gift exemption. You can gift $1,000,000 before there are taxes due. The estate exemption is even larger, but unless you are a millionaire, it doesn't really make a difference. (I presume you are not a millionaire, because if you were you would have your own tax advisors to answer this question for you.)

Just to add: You never know what Congress may do in the future. It could be that at the time you die, Congress will decide to curtail the present estate tax exemption. Also, the exemptions I discussed apply to Federal taxes. Your particular state has its own laws concerning estate and gift taxes.

De[ends on the children. If there is ANY possibility that they could have the house attached in a judgment, or lost in a divorce, or that they would not take care if it or of you, then keep it in your name and leave it to them in a will. There are no advantages to you to give it to them now. If you require government assistance to go into a nursing home, for example, Medicare has a "look-back" period where the transfer will not help you. You could even lose your home if one of your children is financially unreliable.

That said, I am an only child and my widowed mother put me on title with her to her property, as joint tenants with right of survivorship, so there is a smooth transition when she passes. But I would not have allowed her to simply sign it over to me completely.

Better than a will, consult with an attorney about a TRUST. One key thing is to not pay a tax at transfer (probate) and still maintain control of the property until you are ready to fully relinquish all rights to it.

If you are in the UK i would think transferring the property would be a better idea. If you leave it in the will there will be a BIG tax bill added to it.

NEVER, NEVER, NEVER, NEVER transfer ownership to the kids. NEVER.

You will lose ALL control of the property. If you want to sell and move to FL, they MUST agree.

A trust is much better.