Legal Question in Wills and Trusts in Illinois
Sale of property in trust at time of death
Dad died 5/6/03 leaving a 2 story flat as only asset valued approx 200K. No will just Warranty Deed in Trust on property recorded in Cook County. Brother is successor trustee on behalf of 4 siblings. Dad went into nursing home and Ill Dept of Public Aid placed lien on property 12/00 for assistance paid on his behalf with lien to be paid at time property is sold. Very little monies would be left once lien paid. Must we sell or can we continue to hold property and collect some rental income? If yes does rental income count towards estate tax free limit of 1 million??
1 Answer from Attorneys
Re: Sale of property in trust at time of death
It is my understanding that with no qualifed relative (e.g. disabled child) living there, DPA will seek to enforce their lien by forcing sale so they can secure their funds. At that point you could secure a mortgage to pay them off.
But if you want to sit them out, you don't have to put up for sale until they initiate action.
I'm confused by your latter part and your conception of the limit of $1M. From these figures there is no tax concern for your father's estate. No tax on the receipt of ownership. You're now the owners of the property. As you receive income on the property that will be subject to the ordinary rules of income tax.
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