What To Do When You Inherit Real Estate

The passing of a loved one is often a difficult and emotional time. There are many things to arrange and if the person owned real estate, there can be some additional steps to consider when dealing with inheriting property.

Understanding taxes:

Taxes are never fun but they are even less appealing when you are also dealing with the loss of a loved one. In the case of inheriting property, you will probably not have a significant tax burden. This is because the IRS considers the current value of the property when you inherit it against the sales price when you sell it. This is true even if your loved one paid significantly less when they bought it many years ago. For larger estates, there may be additional tax considerations so it is always helpful to talk to a professional about your situation.

Co-owning:

In many cases, a parent may decide to leave the family home to multiple people, usually siblings. In these cases, it is best to have an honest conversation and talk through all of the options. These include living in the home, renting the home, or selling the home. No matter what path you choose, make sure that all agreements have been reviewed by a lawyer and that everything is documented in writing to prevent future problems.

Personal effects inside the home:

Whether you are inheriting your childhood home that is full of personal memories and milestones or a home that a relative lived in without you, chances are that it is full of things that belonged to that person. Going through them may bring up a lot of emotions. It can be helpful to set small goals or even recruit a trusted friend to help keep you on track. There are also professionals who specialize in organizing large amounts of personal effects for sale.