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Inheritance/real estate question

A

ameliasolis

Registered User
Joined
Dec 25, 2021
Messages
98
Location
United kingdom
So wanted to get some feedback on this situation.

My parents are in their mid 60s. Both have cancer and likely only a few years to live. They have 3 kids and plan on dividing their estate equally between the the 3 of us.

We all currently live in a very HCOL location. My parents have roughly $2million in assets between their home, savings, and investments.

They were updating their will and the attorney mentioned buying real estate and putting it in the kids names to reduce the tax burden when they pass.

It just so happens my wife and I are planning to move to a LCOL state soon. Ideally we would like to keep our current home to rent out.

Does it make sense for my parents to buy our new home for us? It would be in our name but we would definitely give them some money each month. Then our inheritance can be adjusted accordingly so my siblings still get an equal share.

Just wondering if there is something I’m missing in this situation.
 
ameliasolis said:
So wanted to get some feedback on this situation.

My parents are in their mid 60s. Both have cancer and likely only a few years to live. They have 3 kids and plan on dividing their estate equally between the the 3 of us.

We all currently live in a very HCOL location. My parents have roughly $2million in assets between their home, savings, and investments.

They were updating their will and the attorney mentioned buying real estate and putting it in the kids names to reduce the tax burden when they pass.

It just so happens my wife and I are planning to move to a LCOL state soon. Ideally we would like to keep our current home to rent out.

Does it make sense for my parents to buy our new home for us? It would be in our name but we would definitely give them some money each month. Then our inheritance can be adjusted accordingly so my siblings still get an equal share.

Just wondering if there is something I’m missing in this situation. Find More Listings Here
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thanks for any help
 
Buying the house for you in your name would create a major tax burden for them because there are limits on how much they can give to any individual(s) in a given year, I believe it's $20,000/yr. The living trust mentioned by the PP probably would be a better option.

Also what is a HCOL and a LCOL? I'm not familiar with those terms.
 
I would ask exactly what tax is at issue. For federal tax on gifts and estates, there is an exemption that as of 2022 stands at $12,060,000.
 
These are TAX Questions and NOT CODE Issues, so I think you should be consulting a Tax Person. I am sure many of us are flattered by the notion that you believe we might have an informed POV, but that would not be true!

There is a similar situation we have in our real lives and that is we are the Reviewer and NOT the Design Professional. Another double yellow line we should not cross
 
Msradell said:
Buying the house for you in your name would create a major tax burden for them because there are limits on how much they can give to any individual(s) in a given year, I believe it's $20,000/yr. The living trust mentioned by the PP probably would be a better option.

Also what is a HCOL and a LCOL? I'm not familiar with those terms.
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High cost of living and low cost of living. I had to Google it also.
 
For instance, compare cost of living in Amarillo TX to San Francisco CA, definitely a locl vs hcol. Median home prices $250k vs $1.3m for instance.
 
Msradell said:
ameliasolis said:
So wanted to get some feedback on this situation.

My parents are in their mid 60s. Both have cancer and likely only a few years to live. They have 3 kids and plan on dividing their estate equally between the the 3 of us.

We all currently live in a very HCOL location. My parents have roughly $2million in assets between their home, savings, and investments.

They were updating their will and the attorney mentioned buying real estate and putting it in the kids names to reduce the tax burden when they pass.

It just so happens my wife and I are planning to move to a LCOL state soon. Ideally we would like to keep our current home to rent out.

Does it make sense for my parents to buy our new home for us? It would be in our name but we would definitely give them some money each month. Then our inheritance can be adjusted accordingly so my siblings still get an equal share.
https://webuyhouseschicago.co/
Just wondering if there is something I’m missing in this situation.
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Click to expand...
thanks all i got my solution
 
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