Father Died with a House

General Real Estate Investing
1

My best friend’s dad died yesterday. The dad bought the house with his ex-wife, but now has full ownership of it himself. The house is in the dad’s name only (not a trust), and the dad has a will. There are three beneficiaries, my friend and his two brothers. The house is paid off in full, he paid $80,000 when him and his ex-wife (the mom) bought it. It is now worth $200,000. My thinking is that they won’t have to pay taxes on the inharitance because it is small.

  1. Does he have to pay any kind of taxes with the sale of the home?
  2. Does he need to wait a certain period (4-months) before the executor (big brother) can sell it?
  3. What should he be aware of?
  4. Who exactly (type of lawyer) should he contact do get this worked out correctly, if any?

Even if you can’t answer the questions it will be helpful to be able to at least tell him exactly how can handle all of this. Thanks!!!

2

the good news is that the heirs inherit the house at the value as of the date of death. so their inherited basis is $200,000; if they sell for $200,000 there is no gain (they should still show it on a Sch D, though) They should get an appraisal (or at least realtor comps) to establish this value.

They can sell it immediately, although there will be some time needed to get through probate (if required) and/or deeds, paperwork etc. complete.

Whatever atty is assisting with execution of the estate should be able to handle it. once it’s in their names, the sale is just a regular contract/sale.

3

mc, who determines the value of the property?

just so we cover that important base.

4

of course, appraisal is the gold standard. a good set of comps will do.

5

  1. So do you recommand that they hire an attorney?

  2. If they don’t involve an attorney then who do you they contact to get the property in their name? I would guess they need letters of testimentary or something for the court, or will the will work?

Thanks!

6

This has to be handled in probate court. Hire a probate attorney.

7

if everyone is in agreement, an atty can file an affadavit of heirship with the will attached and ownership is transferred.

the question is whether you can find an atty who will do it this way.

and if any of the kids are minors, that is a different problem.

8

I am dealing with the same situation. My MIL just died she owned a home with a balance of 124k the home is valued at 550k after rehab min. No one can afford to buy the home but us (that’s if it don’t sale) it’s on the market as is right now for 285k. ok she had 8 kids 2 are minors. My wife is the executor and we are adopting the 2 minors. The family wants to sell the home but it need alot of rehab to get 550K but it’s worth the risk…
What we would like to know is what could be the best direction to take on this?
What should we offer the other family members to buy them out or should we just sale as is and move on?

Any answers, thoughts or ideas welcomed.

2nd Chance Residental Services, LLC