He could do a gift of the interests at this point in time, however there may be several reasons why this might no be a good idea. These include:
- Loss of stepped up basis. If your grandfather deeds the property to you and you sell it, then you would have potential capital gains based upon the value of when he received it. However, if you inherit, then your capital gains would be based upon the value at his death.
- Impact on benefits. I hope that your grandfather will never need to be admitted to a nursing home. But if he does and cannot afford it, then the transfer may have a negative impact on his eligibility for financial assistance through Medicaid or the Veteran’s admin.
He is probably concerned about the probate, if that is the case he might consider a couple of probate avoidance options such as a Transfer on Death Deed or a simple mineral trust.