Tax Tips When Inheriting A Phoenix Home
When you inherit a Phoenix home, your first thought could be happiness at the potential windfall from a loving relative. But you should also be aware that your new asset could end up costing you in the form of assorted taxes that you owe. Consulting a legal professional and an accountant will be very important in making the best decisions based on your financial status. But knowing the basics of your tax liability can help you begin to plan for the future of the property.
Inheritance Tax and Estate Tax and More
Inheritance tax is what you would be responsible for paying when you inherit an item. The estate tax is paid by the estate with the funds in the estate. It is also important to know that there is a federal inheritance tax as well as a state inheritance tax in some states. The rate varied depending on the state and you will need to ask your legal advisor about your particular case. If the house is valued at over $250,000 there is also a chance that you will owe capital gains tax if you sell the property.
Paying the Taxes
In most cases, there are many expenses that come also with any inherited Phoenix home. There could be a mortgage that you must pay as well as any insurance or property taxes that are owed. Rather than seeing the new home as a financial burden, make people elect to sell the house and use that money to pay the tax liability associated with the property. And depending on when you take possession of the home, taxes could be due rather quickly.
A Simple Solution
Unless you have a great deal of sentimental attachment to the house, a fast sale is going to be the easiest and best solution for you. This eliminates as much of the carrying cost as possible and allows you to use the proceeds to pay the tax liability rather than dipping into your savings or taking out a loan. For the fastest sale of any property a real estate investor is always your best approach. The team at Higher Offer works with many heirs to purchase homes that have recently been inherited. We understand the added stress that you are facing due to the loss of a loved one and the complications of dealing with the home sale. We provide you with a cash offer for the home in as-is condition so you never need to worry about making repairs, renovations or even showing the property. Contact Higher Offer today to learn how we can help you settle the home sale in a fast and efficient manner.