Passing Your Home to Your Children: What Comes Next?

Maybe this is the home where you raised your children. It is where your family gathered for holidays, celebrated milestones and created memories that still mean so much today.

As you think about the future, you may also wonder what will happen to the home when your children inherit it. Will they keep it, sell it or disagree about what to do next?

You do not need to make every decision today. However, a little planning now can protect the home, make your wishes clear and help your children handle the responsibility with greater confidence.

Here are five things to consider.

1. Decide What You Want for the Home

Would you like one of your children to keep the home? Do you expect them to sell it and divide the proceeds? Would selling or right-sizing during your lifetime better support your own future?

There is no single right answer. Start by considering what you need, what you want the home to provide for your family and whether your children are interested in keeping it.

2. Understand How and When the Home Will Transfer

Simply telling your children what you want may not be enough. The names on the deed, your will or trust and the way you own the property can all affect what happens next.

There may also be an important tax difference between gifting the home during your lifetime and leaving it as an inheritance.

Why the Timing Matters

Imagine you purchased your home for $150,000 and it is now worth $500,000.

If you give the home to your child during your lifetime, your child will generally receive your original tax basis. If the home is later sold for $500,000, there could be a taxable gain of approximately $350,000 before eligible adjustments and expenses.

If your child inherits the home, its tax basis is generally adjusted to its fair market value around the date of your death. If it is worth $500,000 at that time and is sold soon afterward for a similar amount, the taxable gain could be much smaller.

Before adding a child to the deed or transferring ownership, speak with a Georgia estate-planning attorney and qualified tax professional. A well-intended decision today could create a significant tax difference later.

3. Consider the Cost of Keeping the Home

Even if the home is mortgage-free, your children may still need to cover:

• Property taxes and insurance
• Utilities and lawn care
• HOA dues
• Repairs and regular maintenance
• Legal and probate expenses
  
  

If one child wants to keep the home, that child may also need to buy out the others. Understanding these costs can help you decide whether leaving the home itself is the best option for your family.

4. Understand the Home’s Condition and Value

Knowing the home’s current condition and approximate value can help you make better long-term decisions.

Consider keeping records of major repairs, renovations and improvements. A home inspection can identify maintenance needs, while a local market evaluation can give you a clearer picture of the home’s current value.

This information can also give your children a helpful starting point when they eventually need to make decisions.

5. Talk With Your Family

Your children may have different memories, financial situations and expectations for the home. One may want to keep it, while another may prefer to sell.

A family conversation now can help everyone understand your wishes and reduce confusion later. Discuss:

• Who will be responsible for handling the property
• Whether anyone is interested in keeping it
• How ongoing expenses would be paid
• How decisions would be made
• Where important property documents are kept
  
  

You may also want to put your wishes in writing and make sure they are supported by the proper legal documents.

Planning Now Is a Gift to Your Family

Leaving a home as an inheritance is about more than transferring property. It is about protecting what you have built and making the next chapter easier for the people you love.

You do not have to figure everything out at once. Begin with a family conversation, then speak with a Georgia estate-planning attorney and tax professional.

If you need help understanding your home’s current condition, value or available local resources, I am always happy to be a trusted guide.

Anna Maria Joseph

📞 614.04.0297
📩 amaria@kw.com