When you inherit the home, it may come unexpectedly. Perhaps a grandparent, a parent, or a sibling left you their house in a will. If you inherit a house, your decision to reside in, sell, or rent the home will depend upon a variety of different factors, ranging from tax liabilities to tax considerations. Let’s take a look at some of the reasons that you might want to sell your inherited home.
Capital Gains Taxes
In a normal situation, if you sell a home that has accrued in value, you are liable for capital gains taxes. So let’s say you inherited a home that is valued at $300,000. If you were to sell that home for $350,000 through a normal real estate channel, you’d be liable for capital gains taxes on the $50,000 that you made from selling the house. Selling your home through Houston Capital Home Buyers could help you avoid going through a sales channel that could cost you a tremendous amount of money in capital gains taxes. Houston Capital Home Buyers will help you sell your home quickly in as soon as 7 days, and, by selling your home at its market value, you can avoid capital gains taxes without having to go through the process of a capital gains tax exclusion.
Does Your Inherited Property Have An Open Debt?
Reverse mortgages have slowed since the housing crisis since 2008. However, there are about 80,000 reverse mortgages each year in the United States. If the mortgage obligee was in a reverse mortgage, the person inheriting the property must settle the debt. In this situation, Houston Capital Home Buyers can help you sell the house to settle the debt quickly.
Sometimes, any type of mortgage can create a tricky situation for heirs. Often, an inherited property can result in an unwanted second mortgage or the estate may sell the house right away to pay off any debt on the house.
Is It Worth It To Reside In An Inherited Home?
Sometimes, it might be worth it to live in an inherited home. If the mortgage balance on the home isn’t more than what the home is worth, you can afford the property taxes and insurance, and maintenance costs aren’t too expensive, you may wish to keep the home. Selling your inherited home may be the only option if you don’t want to deal with the costs.
Another thing to think about is your old home. If you inherit a property free and clear of any debt, selling your old home may give you the opportunity to live in a better home and clear the debt on the old property if you have any outstanding mortgages. In either situation, Houston Capital Home Buyers can help you sell your inherited home or your old home.
Renting an Inherited Home
Renting an inherited home is a way to generate a passive income. However, there are some tax implications if you are going to rent your home. Since you won’t be using the home as your primary residence, you won’t be able to use a capital gains tax exclusion if you sell the property in the future. You can deduct certain expenses when it comes to renting your inherited home and rental income is taxed at a lower rate than regular income. It may be worth it to rent your property for a few years and sell it down the road at market value to avoid capital gains taxes.
Sell Your Inherited Home With Houston Capital Home Buyers
The first thought that you might have when selling your inherited home is that you’ll end up owing a tremendous amount in capital gains taxes, but that is not always the case. Maybe the home needs work and can be sold at or below market value. Maybe you have an outstanding debt on an old property and want to live in your new one obligation-free. No matter the situation, Houston Capital Home Buyers can help you get rid of an unwanted inherited home and walk away quickly with cash in hand, helping you sell your home in as little as seven days.