7 Important Things You Need To Know: Inherited Property
Updated: Feb 4
If you have inherited property and you are considering selling it, you must first understand whether or not you have the legal rights to sell the home. It's also important that you understand your responsibilities once the house is sold.
We will share with you 7 important things that you need to know before selling your inherited property.
You May Not Be Able to Sell It Right Away
Many people are unaware of the probate process when it comes to inherited property. And often, a person thinks that because they have inherited a house they can sell it at any point. However, this is not always the case. Although in North Carolina real estate does not have to go through probate there is still a chance that the house may have to be sold.
The monies from the sale of the home would go into an estate account and be used to pay expenses and debts belonging to the decedent if it is decided that there are not enough assets with value to pay off the decedent's debts.
After paying the decedent's expenses and debts if there is money remaining it would go to the heirs and/or beneficiaries unless a will says otherwise.
Understanding The Probate Process
Probate is a legal process in which a court oversees the distribution of assets and liabilities from a deceased person's estate. It can take several months to complete. In most cases, the inherited property can be sold before the completion of probate. However, the executor or administrator will decide whether or not the money from the sale of the home needs to be used to pay off debt or not.
[Need help with probate? We offer helpful probate services and will work with you to find the plan that meets your needs. Learn more.]
Understanding Whose In Charge
In most cases, the executor of the estate will be responsible for overseeing the sale and settlement of an inherited home. The probate process begins with a petition filed in court by the executor that contains information regarding the deceased's assets, debts, and will.
The court will then review the petition and determine whether or not it is valid before granting authority to proceed with selling the home.
It is the executor's responsibility to ensure that the home is sold for fair value and in a timely manner. They also have to ensure that all proceeds from the sale of the inherited property are distributed according to the decedent's will or Trust.
You May Need To Fix The House Up Before Listing It
Inherited property is often outdated, and may require some repairs or renovations before it can be sold. Before you put your inherited property on the market, consult with a real estate agent to receive an estimate of what you will likely get for it when you sell it. This gives you an idea of whether or not selling the home makes financial sense.
Capital Gains Taxes
Another thing to consider with selling inherited property is capital gains taxes. Capital gains taxes are imposed when an Inherited Property is sold for more than the purchase price, so it's important to understand this before selling. Consulting a tax professional or attorney can help you better understand any taxes that may be imposed when selling Inherited Property.
Here are two examples of how to calculate capital gains taxes.
Example #1: Selling at Market Value
The original owner purchases a home in North Carolina for $200,000. The market value of that house increases to $250,000 at the time of the owner’s death.
You will pay $0 against the capital gain tax if you sell the property at the same market value of $250,000.
Example #2: Selling Above Market Value
The original owner purchases a home in North Carolina for $200,000. The market value of that house increases to $250,000 at the time of the owner’s death. You decide to sell it for $300,000.
You will pay a capital gain tax of $50,000 if you sell the property at the best value of $300,000, which is over the market value of $250,000.
Who You Should Consult With
When selling an inherited property, it is best to consult with a qualified attorney who can advise you on the legalities involved with probating and distributing assets from an estate. They can help you understand your rights and responsibilities when it comes to Inherited Property.
You will also want to consult with an accountant or tax professional to understand any applicable capital gains taxes that may be due when selling Inherited Property.
Last but not least, you should consult with a real estate agent who is experienced in handling probate and Inherited Properties. They will be able to provide you with invaluable guidance and advice throughout the process of selling Inherited Property.
How North Carolina Probate Solutions Can Help You
Whether it's selling your inherited home or helping you to navigate through the probate process our services are designed to help put everything in place for you.
We partner with the best probate attorneys, contractors, trash/junk removal companies, estate sales companies, inspectors, lawn and landscape companies, and many more. Anything you need to make the probate process move forward smoothly, we can put it in place for you.
Whether the home needs to be staged, photographed/video, or cleaned out we will get the home ready to be placed on the market and sold for the highest price possible.
Other Services and Professionals You May need:
Someone to measure the house
Landscape and Gardening
When You Use Our Service We Coordinate It All For You!
By understanding Inherited Property, you will protect yourself from any legal ramifications down the road and ensure that everything is handled properly. With careful planning and foresight, you can successfully sell Inherited Property with no stress or complications. And we are here to help you. If you have any questions or would like a free consultation please give us a call. We would love to assist you and lay out a plan for you that will leave you worry-free.
Denise Harper Davis
Certified Probate Real Estate Specialist
* NOTE: North Carolina Probate Solutions and the author of this article is not a licensed attorney or CPA. This post should not be considered legal or tax advice. Always consult an estate attorney or tax professional when needing legal answers and legal advice.