Legal Question in Real Estate Law in Massachusetts
Real Estate Transfer
My father in-law has a vacation house worth approximately 2 million dollars. The family is trying to help him figure out how to transfer the house to his children either when he dies, or before, to minimize the amount of taxes they will have to pay. If he just wills it to his children, do they have to pay tax on it even if they do not sell it? Or could he transfer the house to them before he dies? Or could he even sell the house to one of them for under market value?
2 Answers from Attorneys
Re: Real Estate Transfer
I agree with Attorney Roth that the best course of action can only be determined by viewing your father-in-law's estate in its entirety.
There are a number of options your father-in-law might consider, including a lifetime gift to the children, leaving the home to the children in his will, or possibly creating a trust to hold and transfer the property.
Please feel free to contact me if I can be of any further assistance, or if your father-in-law would like to schedule a consultation. I am located in North Quincy.
Re: Real Estate Transfer
I strongly suggest your father-in-law meet with an estate planning attorney to determine how best to put his estate in order.
As to the vacation home, if left to his children and the total amount of property left to the persons other than his wife at the time of his death is $2 Million or less this year, no federal estate tax will be payable, but MA will apply a tax on the value in excess of $1,000,000.00 to the home.
If gifted in its entirety to the family other than the wife, there would be a gift tax under federal law for the amount in excess of $1,000,000.00.
However, there are alternatives to these two options but they need to be determined by looking at your father-in-laws entire estate.
Please feel free to contact me or have your father in law contact me to discusss the matter.