Also known as: defend title · perfect title · defending title · perfecting title · title defense · title perfection
Written by attorneys · grounded in primary & secondary sources — see below
A category of legal expenses incurred to establish, maintain, or clear ownership rights in property. Such costs are treated as capital expenditures added to the property's basis rather than as currently deductible business or investment expenses.
After Arthur's death, his will devised the Press Building to Daniel subject to an existing mortgage. When the bank foreclosed and Media Investments purchased at the sale, the personal representative executed a deed confirming the transfer. The deed served only to perfect record title already passed by operation of law.
Olivia's chain of title contained an omitted boundary call that left part of the backyard uncertain. Maple Row refused to close until a quiet title action resolved the adjoining owner's claim. The cost of that action would be incurred to perfect title and treated as a capital expenditure.
Select any source to read its text and confirm it supports the definition.
No. Expenses incurred to defend or perfect title are capital expenditures that must be added to the property's basis rather than deducted currently.
Yes. Transfers by operation of law or by will pass title without a deed from the transferor, but a fiduciary may execute a deed to perfect record title.
Title is unmarketable when a significant defect, such as an unresolved boundary dispute or pending litigation, exposes the buyer to litigation risk that a reasonable purchaser would not accept.