Except my parents are in so much medical debt that I won’t inherit anything. I would have loved to inherit my dads house but there’s no way the bank won’t just take it to pay off that debt and I definitely can’t afford to buy it.
Parents can gift their kids 17k/year tax free. They could gift you fractions of the house over time until you either own it outright, or at least you can keep the portions you DO own when they die.
That’s assuming they own their house. Not sure how it works with mortgaging.
You can gift your kids whatever you want. You don’t need to worry about the gift tax exemption if you are planning on giving them less than $13 million.
If a gift exceeds the $18,000 limit for 2024, that does not automatically trigger the gift tax. Also for 2024, the IRS allows a person to give away up to $13.61 million in assets or property over the course of their lifetime and/or as part of their estate.
Huh. So as long as he gifts me the house before he dies then I’m good? Of course the issue there is that he’s likely to croak before my stepmom does and I’m not sure what would happen with the medical debt then. They can’t just take what would then be my stepmoms only residence but she would also be required to pay off that debt if I remember right. It’s going to be a clusterfuck either way.
Well I guess thats the plan then. I’ll have to talk to my parents about that. Thank you.
It was a property origionally bought by my greatgrandparents and I really wasn’t looking forward to seeing it sold off just because my dad has health issues. Now I guess I have a way to keep it.
Look into Medicaid asset trusts more. I’m not your financial advisor. But the process seems simple. The trust owns the house and other assets so they can’t be taken from your parents.
What if they transferred the deed to the house for OP for a low price, and then paid rent. That could be way over the $17k limit, and then they’d own the house.
Except my parents are in so much medical debt that I won’t inherit anything. I would have loved to inherit my dads house but there’s no way the bank won’t just take it to pay off that debt and I definitely can’t afford to buy it.
Are they going to live for a while?
Parents can gift their kids 17k/year tax free. They could gift you fractions of the house over time until you either own it outright, or at least you can keep the portions you DO own when they die.
That’s assuming they own their house. Not sure how it works with mortgaging.
https://www.fastexpert.com/blog/selling-your-home-to-your-child-what-you-need-to-know/#:~:text=If your home has a,responsible for paying gift taxes.
Read it and weep: https://www.payingforseniorcare.com/medicaid/look-back-period
That’s only relevant if they want to newly apply for Medicaid, right?
Just need to stop transfers 5 years before you apply for medicaid. Easy peasy, lol.
You can gift your kids whatever you want. You don’t need to worry about the gift tax exemption if you are planning on giving them less than $13 million.
https://smartasset.com/estate-planning/gift-tax-explained-2021-exemption-and-rates
Huh. So as long as he gifts me the house before he dies then I’m good? Of course the issue there is that he’s likely to croak before my stepmom does and I’m not sure what would happen with the medical debt then. They can’t just take what would then be my stepmoms only residence but she would also be required to pay off that debt if I remember right. It’s going to be a clusterfuck either way.
People do that all the time. But there are clawback periods.
Basically people give their kids the house and the kids let them live there free. You can create a irrevocable trust for that very purpose.
https://www.verywellhealth.com/irrevocable-trust-medicaid-4173386
Well I guess thats the plan then. I’ll have to talk to my parents about that. Thank you.
It was a property origionally bought by my greatgrandparents and I really wasn’t looking forward to seeing it sold off just because my dad has health issues. Now I guess I have a way to keep it.
Look into Medicaid asset trusts more. I’m not your financial advisor. But the process seems simple. The trust owns the house and other assets so they can’t be taken from your parents.
What if they transferred the deed to the house for OP for a low price, and then paid rent. That could be way over the $17k limit, and then they’d own the house.
If you do that, the difference between the low price and the “real” price could be considered a taxable gift.
have you tried pulling up your bootstraps and being born again to a mega rich family?