I inherited a house in Florida, What do I do?

I inherited a house in Florida, What do I do?I Inherited a House in Florida, What do I do?

The death of a loved is always difficult. Especially, when they leave you something in their will, it can be a little overwhelming. Inheritance laws differ from state to state. If you have to inherited a house in Florida and you want to sell it, there are a few things you should know about the inheritance law in Florida before you put the house up on the market.

Aside from a will, you can also inherit a house by way of a trust and by way of a deed. The way you inherit the house depends on how you will be able to sell.

If you inherit a house in a trust and the person who died has left spouse or children behind, you will have to go through Florida probate to clear title. If you inherit it in a will, you will have to go through probate court as well if you want to sell the house. In many cases, you will not be able to sell the house until 4-5 months after the probate proceedings to fully clear the legal title. In case you inherit the house by deed, you will not have to go through probate in Florida and the sale of the house will be easy.

I inherited a house in Florida, What do I do?Probate process in Florida

Probate is the process by which an estate of a deceased is settled under the supervision of the court. There is an executor or Personal Representative who in charge of the probate proceedings. This person is usually nominated by the deceased person’s will and is either the surviving spouse or an adult offspring. If there is no will, the person is appointed by the court. This Personal Representative is legally responsible to collect and value the assets of the deceased person. They have to pay the bills and taxes and then eventually distribute the assets to their respective heirs. Without probate, fraud would be a lot more common. Until the court can determine that the will is legal and valid, the assets are frozen to prevent anyone from taking something that they didn’t actually inherit. So if you have inherited a house in Florida in a will you have to attend these probate proceedings to get your inherited house through the proper procedures.

Probate proceedings can either go really quick or really slow. If you probate a house and the previous owner has been dead for two or more years, the whole procedure can take just a week. If the owner is recently deceased and you want to sell the house soon, the probate could take around 6 months because the ownership in the property records needs to be fixed.

Inheriting a house in Florida with mortgage

The main thing to remember here is that if you inherit a house with mortgage, you will have to pay it or the house will get foreclosed on. You will have no trouble with mortgage companies as long as you keep paying the deceased person’s mortgage. But if you inherit a house in Florida that has been paid off, then you don’t have to worry about mortgage or any other such debt issue.

Homestead exemption

When you talk about a homestead, it is the name for legal protection that is offered by state when it comes to the deceased person’s primary residence. The basic idea is that the deceased person’s homestead is protected from creditors for their spouse, children or anyone else who was legally dependent on the deceased person. After six months of the deceased person’s passing away, the surviving can choose to receive on-half of the interest in the homestead property. When the house is sold, the other second half of that money from the sale of the house goes to the descendants of the deceased person.

I inherited a house in Florida, What do I do?Tax implications of inherited property in Florida

If you have inherited a house that is a homestead, there are certain tax related factors that you will need to deal before you can sell off the house. First thing, if already have your own homestead and you have inherited the homestead of the deceased person, there will be property taxes and those taxes will go up. If the person had owned that house for a very long time, then the property taxes will be quite high. This can happen when your parents have their own house and you have your own house and your parents leave you their homestead. The second important factor here is that of income tax. While the property tax may be high, the income tax from the sale of that inherited house will not be very high. There is an income tax concept that is called ‘step up in basis.’ Your parent’s basis would include the amount they paid for real estate and the capital gains. So instead of inheriting the house at this basis, you inherit the house at the fair market value of the house on the day of their death. This is especially good news for those children who have their own houses. Because if you didn’t already have a residence you would have to pay the income tax on the capital gain between the sale price and the book value basis.

I inherited a house in Florida, What do I do?Selling house in Florida that multiple people inherited

If you have inherited a house with more one person, things can get tricky. Even if they are your siblings and you are very close, these matters are not easy to deal with. Selling the house will take time so all of you will have to be very patient with each other. Under Florida’s law of inheritance, all of the co-inheritors are equally responsible for the liabilities, income tax, debts and mortgage that need to be paid off. No matter what the work is, whether it is property insurance, property taxes, property management fees, bills and utilities and so forth, they will all have to be equally split among the new co-owners. This situation can be quite a nightmare, especially for those families in which the siblings are not on very good terms with one another. Administratively speaking, the situation is a trying one. The more the co-owners, the more argument there generally is.

This is why, generally in such situations, it is the responsibility of one child to manage everything and do all the work while others sit back and let one person handle everything. This one person is like the ‘property manager’ of the inherited house. If he or she does do this, they should be paid or compensated for in some to avoid any resentment or fighting about dumping all the work on one person. If no one has the time or energy to become property manager, you can hire one to help you out. This will be a professional with experience and knowledge so in case of any argument or confusion, he might be able to mediate and help out should you need him/her to do so. If you all want to sell the house will also have to go through the probate process and that can take quite a few months. So it is a good option to hire a property manager in the meantime if neither of siblings can be property managers. This way everything will be handled smoothly for a few months.

Once you manage the debts and the taxes after inheriting the house and the probate process is complete, you can start working on listing the house to get it sold. Now, like every other house that needs to be sold, this house will also be in need of some repairs unless it was kept in very good condition by the deceased. You will either need to sell the things in house of divide them up as you see fit. The repairs of house are also the financial responsibilities of all owners, equally.

So once a house with multiple owners has been sold, the process has to be split equally among the owners, as instructed by the will, trust or deed document. However, some problems may arise in the selling of the house. Sometimes, one of the siblings/ co-owners decides to move into the inherited house itself and refuse to leave. This can be a very big problem if that live-in owner doesn’t want to sell the house and the other owners want sell it. In this, the Florida law, like inheritance laws of other states, allows you to sell your share of the house to sibling who wants to keep the house. This way everyone gets what they want.

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