Call Us Now
Receiving an inheritance can be a hectic time. It can be hard to decide just what to do when you’ve inherited a house.
Read on to learn about your options when you’ve inherited a house.
When you first inherit a house, there are basically three things you can do with it. You can move in yourself. You can sell the house. Or you can keep the house and rent it.
Technically, you can also do nothing, but most people want to get the most out of their inheritance.
At the moment when you’re first inheriting a house, there may be no taxes of any kind. As long as you don’t do anything with your new house, you may be able to ignore any tax concerns, except for yearly property taxes.
However, as soon as you decide to move in, sell or rent, you’re going to have to figure out what to do legally. Depending on which option you choose to take, you’re going to deal with different legal and tax scenarios.
As soon as you move into a house, you may find yourself subject to a mortgage or to HOA fees. HOA fees are homeowner association fees.
Homeowners, in certain areas, are required to pay monthly fees to the association in return for assistance in maintenance or beautification of the house or neighborhood.
Selling a house can be cheap or expensive depending on how much you put into it. While it can be tempting to go the cheap route, getting the best sale means getting a higher sale price and making the sale quicker.
We go further into how you can get the most out of selling your house below. One thing to keep in mind, though: regardless of how you sell your house, you may be required to pay capital gains taxes on the sale of your home.
Capital gains taxes are collected after selling off an investment.
The Taxpayer Relief Act of 1997 states that single people do not have to pay any capital gains tax if their home’s sale makes $250,000 or less. Couples who sell a home together can remain exempt from the tax on a sale as high as $500,000.
However, if your home sells for more, you may have to pay the capital gains tax. That doesn’t mean you should refuse to take more than $250,000 for your house (if you’re single), though. If you sell your house for $260,000, then only the $10,000 that exceeds the $250,000 limit will be subject to tax.
Therefore, you should feel free to get the best price possible for your house. While the capital gains tax rate has fluctuated over time, it currently caps out at 20% at the highest.
In a scenario where you rent out your house, you’ll be paying property taxes on it each year. However, your costs may actually be lower than if you lived in the house yourself, as you can deduct house maintenance and upkeep.
If you’re just learning about what to do when you inherit a house and want to sell it, you should know that the name of the game is “curb appeal.”
There’s no exact definition of curb appeal, but it basically means how appealing your house looks from the side of the road. Technically, it can also refer to how appealing every aspect of your house is to a potential buyer.
Increasing your curb appeal will increase your selling price and may also increase how quickly you can sell your house.
Of course, you can always increase curb appeal by spending more and more on the house, but some improvements cost more money to make than they’ll profit you on the sale. It’s important to be economical and only invest in those home improvements that will more than pay for themselves.
The cleaning and neatening of your home is the first step towards increasing curb appeal. Whatever your house has going for it, you want to show that off in the best possible light.
Basic maintenance includes making everything sparkling clean and organized on the inside. Outside, make sure the grounds are looking their best with trimmed shrubs and a cut lawn.
Pressure washing is a fantastic way to make old sections of a house look sparkling new. You might not believe it until you see it, but a quality pressure washing service can take old paneling, grey walkways, and faded wood structures and make them look like they did when they were brand new.
BoredPanda has collected an impressive and dramatic series of before and after shots showing just how great pressure washed items can look. Why replace old items with new ones when you can make them look new just by pressure washing them?
Depending on how good the paint on your house is looking, a new paint job may be able to pay for itself. If the paint is looking especially old, it may drag down your sale price, so think of new paint as an investment.
Using window boxes and potted plants is a great way to decorate your house with plants and other flowers. You want to paint a picture in people’s heads of how perfectly put together their new home could be, so attention to detail is the key to success.
You might feel inexperienced in creating a potted plant “garden”, but a few simple tricks can make sure your home looks its best.
Google potted plant gardens and copy some popular color schemes. Make sure to buy a variety of pot sizes and place the tallest plants behind the shortest ones.
We hope you learned something helpful about what to do when you’ve inherited a house. To learn more about selling or managing houses, check out our other pages!