If your parent dies and leaves a home as part of your inheritance, you will have to decide what to do with that asset. Many other Floridians face this decision and generally, there are three different things you can do. Each has its own set of pros and cons and no one option is right for every situation. Knowing a bit about the various options can help you make the best choice for you and your family.
Forbes explains that some people make the decision to move into their parent’s home. If you have siblings involved, you may set up an agreement in which you pay them rent or buy them out. Moving into a parent’s home can allow you to take more time to go through their belongings than if you were to sell the home right away. If you eventually sell the home, you may be able to be excluded from capital gains tax up to a certain amount depending upon how long you personally lived there.
If you opt to keep your parent’s home but turn it into a rental, you will want to convert the insurance to a landlord versus residence policy. Costs may be incurred for management of the property unless you live close enough to do this yourself. You may be able to enjoy some annual tax benefits by renting but you may be required to pay these back if you later sell the home.
By choosing to sell your parent’s home from the outset, you will go through many of the same steps as with any home sale. This includes reviewing comps. You may also need to address capital gains.
This information is not intended to provide legal advice but general information about how to handle an inherited home in Florida.