Inheriting a Property: Keep, Sell, or Rent?

Inheriting real estate comes with important decisions and potential tax benefits. One key advantage is the step-up in basis, which resets the property’s value to its fair market value at the time of inheritance. This can significantly reduce capital gains taxes if you sell the property.

Option 1: Keep the Property

Keeping the property can preserve family memories, but you’ll need to plan for maintenance, taxes, and insurance.

Option 2: Sell the Property

Selling provides immediate cash, and the step-up in basis helps reduce taxes owed on the sale.

Option 3: Rent the Property

Renting offers ongoing income and some tax benefits through depreciation, but it also comes with the challenges of property management and potential depreciation recapture taxes later.

Plan Before You Decide

Whether you keep, sell, or rent, make sure your choice fits into your broader financial plan. Consulting a financial advisor can help ensure you make the most of your inherited property.

Click here to schedule a consultation with one of our financial advisors.

William Medcalf
Senior Financial Planning Associate, Wiser Wealth Management

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