Did Joe Paterno Sell His House to His Wife for $1 to Avoid Civil Lawsuits?

As more information from the Penn State scandal leaks out, I’m sure we will be uncovering plenty more pieces of shady information like this one. Joe Paterno and his wife bought a home near the Penn State campus for $58,000 in 1969. According to court documents filed in Centre County, Penn. that were uncovered by the New York Times, the house is now valued at $594,484.40. Paterno and his wife, Suzanne, had joint ownership of the home until recently.  Now that’s what I call a solid investment.

For whatever reason, Paterno decided to sell the house to his wife for $1 four months ago, placing ownership of the property solely in her name.  Actually, he sold it to her for $1 plus “love and affection.”  What would inspire Paterno and his wife to complete such an odd transaction?

According to one of JoePa’s lawyers, Wick Sollers, the transaction was simply part of a “multiyear estate planning program” and the transfer was just an element of that plan.  Naturally, they insist Paterno selling his own home to his wife has nothing to do with the Jerry Sandusky scandal.

Legal experts have debated Paterno’s motivation, with some saying that the family’s house has undergone years of complex transactions that would make it impossible to draw any conclusions from this one particular transfer.  However, law professor Lawrence A. Frolik from the University of Pittsburgh said that he has never heard of such a transfer taking place for tax purposes and would only have one initial reaction when told that a man had sold his house to his wife for $1.

“I can’t see any tax advantages,” Frolik said. “If someone told me that, my reaction would be, ‘Are they hoping to shield assets in case if there’s personal liability?’ It sounds like an attempt to avoid personal liability in having assets in his wife’s name.”

Yes it does, doesn’t it?  It is obvious that Paterno could be subject to civil lawsuits in the wake of the massive scandal, so assuming he made this transaction with his wife with that in mind would be not only reasonable but completely commonsensical.  As they so often say: Where there’s smoke, there’s usually fire.

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  • Anonymous

    This would be suspicious only if you were sure that paterno had magic powers to see into the future. This isn’t odd at all for people trying to avoid taxes and legal issues after death.

  • Anonymous

    I don’t claim to be any type of legal genius, but what exactly would prevent Joe Paterno’s wife from getting his house after he died?

  • http://pulse.yahoo.com/_BUVTYBRPXQKF4AD3GBJRAKK5QQ culebra

    Hasn’t anyone noticed that Joe Paterno is OLD? Professor Frolick is being completely disingenuous in stating there is no tax advantage for such a transaction, given his credentials. The transfer keeps the house out of probate court, as any 2nd year law student would know.

  • Anonymous

    Also culebra moves like this can keep someone like Paterno under the death tax for the feds and for pennsyl state

  • http://pulse.yahoo.com/_36PQJIUADT2KLO4VMIXZ7H7PRQ Ricky

    Frolic can’t see any tax advantages to it because he’s an attorney specializing in Elder Law and doesn’t know anything about estate planning. In Pennsylvania, one of the best ways to shield individual assets from creditors is to own them with your spouse, as tenants by the entirety.  What the Paternos seem to be doing is equalizing their assets to take advantage of each spouse’s unified credit, in the even that portability of credits expire.  This is a non-story. 

  • http://pulse.yahoo.com/_36PQJIUADT2KLO4VMIXZ7H7PRQ Ricky

    Actually, he owned the house jointly with his wife.  It would not be subject to probate, but would pass by operation of law to his wife on his death.

  • http://pulse.yahoo.com/_36PQJIUADT2KLO4VMIXZ7H7PRQ Ricky


  • Anonymous

    Amazing how Mr. Frolik can’t (or doesn’t want to) figure this out.  I don’t do any estate planning work myself and knew this.  What motivates people to allow themselves to be quoted in national publications and be so ignorant of the facts? 

  • http://www.facebook.com/tommy.petton Tommy Petton

    Wow that is powerful cool-aid they have in PA.. Guess, I should not be surprised after the reception the despicable Michael Vick was given. That stated, can any of you legal experts show me any case law where what transpired had any greater benefit than owning it jointly – other than shielding it from civil damages. This “sale” occurred four months ago. The Grand Jury convened long before that. Do you really think Joe had no idea what was coming and reflected upon how his actions, or rather in-actions, could come back to haunt him? I think anyone who thinks otherwise is way too close to Penn State and/or Paterno to be objective.