Legal Question in Wills and Trusts in Maryland
If parents die and the home was titled so that it passes directly to the children and not thru an estate does the home fall under the "trust" that was set up. Also, if some of the children want to then charge rent from another child who also owns a portion of the home does this create legal liability (taxes, etc) to the owners who do not want to accept rent and can some of the children charge rent if others who also own a share of the home do not agree to charge rent?
1 Answer from Attorneys
Did your parents retain a life estate and provide the children with a remainder? If so, it is unlikely that it passed through the trust. However, more information is needed.
If the current sibling who is in the house agrees to enter into a contract regarding rent, the lease can be created to take into consideration the desires of everyone. For instance, if the current market value of rent for the house is $1,000, and there are 5 children. The agreement could provide that she would pay $200 per child. However, those who don't want to receive the money could provide that she could use the money to repair or improve the house. This may increase the equity portion of those who decide not to take the rent directly.
You should consult with your accountant regarding the tax consequences. There may not be any. (also licensed in Maryland)
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