Interested in Your Own Personally Branded Magazine? Click Here!

Want to customize this content for your business?

Learn More

Categories

  • Home
  • Decor
  • Real Estate
  • Life & Culture
  • Food & Recipes
  • Holiday & Entertaining

  • Printables
  • Videos


General

  • About the Magazine
  • Advertise
  • Copyright
  • Privacy Policy
  • Cookie Policy
  • Careers


Editorial

  • Editorial Calendar
  • Issue Archive
  • Contact Us
  • Pitch an Idea

American Lifestyle Magazine Logo
  • Home
  • Decor
  • Real Estate
  • Life & Culture
  • Food & Recipes
  • Holiday & Entertaining
  • Search
  • Follow
  • 0 Heart
  • |
  • Food & Recipes Categories
    • All Recipes (763)
    • Appetizers (139)
    • Breakfast (63)
    • Cooking Tips (41)
    • Desserts (219)
    • Dinner (229)
    • Drinks (59)
    • Gluten Free (9)
    • Healthy (68)
    • Lunch (7)
    • Quick & Easy (60)
    • Vegan (35)
    • Vegetarian (53)
Dinner | Mar 20, 2023

Kimchi Grain Bowl

  • Holiday & Entertaining Categories
    • Celebrate (2)
    • Christmas (83)
    • Easter (14)
    • Entertaining (40)
    • Fall (11)
    • Father’s Day (6)
    • Halloween (29)
    • Hanukkah (17)
    • July 4th (34)
    • Mother’s Day (8)
    • New Year’s (23)
    • Spring (2)
    • St. Patrick's Day (11)
    • Summer (1)
    • Thanksgiving (36)
    • Valentine’s Day (5)
    • Winter (12)
Family & Pets | Dec 14, 2022

Customize Your New Year’s Eve Celebration

  • Decor Categories
    • Crafts & DIY Projects (279)
    • Curb Appeal (6)
    • Decorate (73)
    • Interior Design (87)
Interior Design | Mar 17, 2023

How to Celebrate Spring with the Pantone Color of the Year

Interior Design | Mar 8, 2023

The Wonder of Woodworking

Interior Design | Feb 1, 2023

Houston, We Have a Rebuild

  • Real Estate Categories
    • Buying & Selling (203)
    • Home Trends (23)
    • Staging (21)
    • Your First House (34)
Staging | Feb 13, 2023

Put Your Best House Forward

Decor | Nov 14, 2022

Design Trends to Follow in 2023

Real Estate | Sep 23, 2022

How to Shop for a Home Loan

  • Life & Culture Categories
    • Editorial (314)
    • Family & Pets (206)
    • Finances (34)
    • Health (159)
    • Travel (253)
Editorial | Mar 17, 2023

The Magic of Moonbows

Travel | Mar 14, 2023

Blazing a Golf Trail

Cleaning | Feb 28, 2023

Detail Your Car like a Pro

  • Home Categories
    • Cleaning (44)
    • Organizing (48)
    • Home Improvement (124)
    • Outdoors & Gardening (90)
Outdoors & Gardening | Mar 2, 2023

Prepping Your Home for Spring

Cleaning | Feb 28, 2023

Detail Your Car like a Pro

Home Improvement | Jan 18, 2023

4-Week Home-Improvement Challenge

Follow us on social media today!

Facebook Twitter LinkedIn

How to Sell an Inherited House

Buying & Selling | By Nathan Smith | 0 Likes
SHARE
Facebook Twitter LinkedIn More

The passing of a loved one is a somber time, and working through the departed’s last will and testament can be stressful. This is especially true if a home is part of the inheritance.

If you do inherit a home, you’ll have a few options—move into the house, turn it into a rental, or sell it. If you decide to sell the home, you will need to be well-prepared, as there are some unique situations during the sale of an inherited home compared to a traditional sale.

Determine the value of the property 

This is a good first step in the process. There are several factors that can influence the value of the property, including the condition and the location of the home. Contact a trusted agent to have the property valued and walk you through the rest of the process.

Check on the mortgage and outstanding debts

If the home wasn’t paid off before your loved one’s passing, you will be responsible for paying off the remaining balance of the mortgage. The selling of the home should settle any outstanding amount left on the mortgage, but if there is no mortgage remaining, you’ll own the property free and clear.

There are also a handful of unique situations you’ll need to be aware of when it pertains to the mortgage:

  • Check to see if there is a due-on-sale clause. Some mortgages require the entire loan to be paid off if the property transfers from the original borrower to someone else.
  • If there is a reverse mortgage in place, you may have a limited amount of time to pay it off.
  • If there is more owed on the home than it is worth—also known as being underwater—you may need to get the lender to agree to a short sale. This means the lender will accept less than the remaining loan amount from the proceeds of the sale.
  • The estate can also cover the remaining mortgage, meaning you’ll own the property outright.

In addition to the mortgage, check to see if there are property taxes or utility bills that that have outstanding balances.

Your tax responsibility

Inheriting a home doesn’t come with any initial tax liability. But if you decide to sell it, you will need to be prepared to pay taxes on the proceeds.

Selling inherited property requires you to pay the federal government capital gains taxes. These are taxes you pay to the government on profits you make from the sale of an investment.

The step-up tax basis helps protect you from paying a large amount toward capital gains taxes. You’ll inherit the home at fair market value, and your tax responsibility begins from the time you inherited the home and ends when you sell it. For example, if a home is appraised at $300,000 after the original owner’s passing and their heir sells it for $310,000, then the $10,000 difference is the only taxable gain.

You may also have to pay an inheritance tax, depending on your state. There are six states that have these laws: Iowa, Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania. The rules differ state by state, and each has different rules based on the estate size and asset types. Some of these states exempt the spouse and certain heirs from paying the inheritance tax.

There is also an estate tax in twelve states and the District of Columbia. Again, these taxes vary from state to state. But the exemption amount is a minimum of one million dollars in each.

Selling the home

When selling your inherited home, be aware that you’re responsible for several costs. These can include any surveys, agent services, and closing costs.

Renovate vs. selling as-is

One of the largest costs you’ll face selling an inherited home is repairs. However, you have two options: make the necessary repairs or sell the home as-is. Before you make the decision, it can be beneficial to get an inspection. This will help you better understand the renovations needed and make a better decision on what the return on investment (ROI) will be on potential repairs.

Both options have pros and cons:

  • Selling a home as-is allows you to put the home on the market without making any major repairs. This could be a good option if there are numerous high-priced repairs. However, you will likely need to list the home below its market value, and an as-is listing can be harder to sell. You must also disclose any issues you find with the home.
  • Renovating a home will help the home become more desirable to potential buyers and can help you sell the home at a higher price. However, you will be responsible for the cost of the repairs, and the time it takes to make the repairs could delay getting the home on the market, which can lead to you paying additional property taxes and utility costs.

Inheriting a home comes at a tough time in your life. But by going in prepared, the process can become a little easier.

8053 Views

This article is tagged in:

Home AdviceHome CareHome SellingHome TipsSelling

Related Posts

Real Estate | Feb 13, 2023

Put Your Best House Forward

Real Estate | Sep 19, 2022

Are Open Houses Worth It?

man and woman looking at a computer
Real Estate | Aug 17, 2022

Build a Smarter Buyer Wish List

Home | Aug 15, 2022

7 Eco-Friendly Updates That Will Make Your Home More Marketable

Real Estate | Aug 11, 2022

Understanding the Short-Term Investment Market

Popular Posts

can-planters-card
Decor | Mar 25, 2020

Make Your Own Can Planters

Home | Jul 8, 2021

Tips for Redesigning Your Patio Space

Life & Culture | Feb 17, 2020

Trash vs. Recycle: Do You Know When to Trash it?

spring-cleaning-countdown
Home | Mar 23, 2021

Spring-Cleaning Countdown

Real Estate | Dec 14, 2017

House Selling Checklist


You may also like:

can-planters-card
Crafts & DIY Projects | Mar 25, 2020

Make Your Own Can Planters

Outdoors & Gardening | Jul 8, 2021

Tips for Redesigning Your Patio Space

Health | Feb 17, 2020

Trash vs. Recycle: Do You Know When to Trash it?

spring-cleaning-countdown
Cleaning | Mar 23, 2021

Spring-Cleaning Countdown

Buying & Selling | Dec 14, 2017

House Selling Checklist

home office with white furniture
Health | Mar 30, 2020

Everyone Is Working From Home—Here’s How to Do It Effectively

decorating-basics
Interior Design | Jun 9, 2020

These Tips Are Your North Star For Home Decorating

Share on Social Media

Our mission is to deliver entertainment that inspires and motivates our readers, encouraging them to follow their passions as they explore new horizons.

© 2023 American Lifestyle Magazine

General
  • About the Magazine
  • Advertise
  • Copyright
  • Privacy Policy
  • Cookie Policy
  • Careers
Editorial
  • Editorial Calendar
  • Issue Archive
  • Contact Us
  • Pitch an Idea
Categories
  • Home
  • Decor
  • Real Estate
  • Life & Culture
  • Food & Recipes
  • Holiday & Entertaining
Follow Us
Facebook Pinterest Instagram Youtube

Customize this content for your business!

Learn More

,