Inheriting a house can seem like a blessing in some situations, but it’s important to be aware of the potential hidden costs that come with it. It is very likely that you have some mixed emotions about the whole thing. You may be dealing with grief, costs, family members, and all sorts of things that nobody can really prepare you for. When taking on an inherited property, knowing what it will cost you is important. Here is a look at some of the costs you may face when inheriting a property in Broward County so you can make the best decision throughout the process.
Tax Obligations
Florida does not have a state income tax or a state inheritance tax2, so you will not have to pay any taxes to the state when you inherit a property in Florida. However, you may still have to pay federal taxes, depending on the type and value of the property. For example, if you inherit a property that has appreciated in value since the original owner acquired it, you may have to pay capital gains tax when you sell it. The capital gains tax rate depends on your income level and how long you hold the property before selling it. It can be as high as 20% for long-term capital gains (assets held for more than one year) and as high as 37% for short-term capital gains (assets held for less than one year)3. Additionally, if you inherit a property that is part of a large estate (over $11.7 million in 2021), you may have to pay federal estate tax, which can be as high as 40%3.
Utility Bills
Whether or not someone is actively living in the home, you’ll want to pay to keep the lights on. The property will need water and power, which can add quickly to the mothy costs you experience as the owner of the property. It is for this reason that many people who inherit a house in Broward County, search for the fastest way to sell. Paying the bills on an empty house simply doesn’t make sense. When there are no active plans for the property, sometimes a fast sale is best.
Liens and debts. Inheriting a property in Florida does not mean that you inherit it free and clear of any liens or debts attached to it. A lien is a legal claim that a creditor or another party has on the property as security for a debt or obligation. A debt is an amount of money that the original owner owed to someone else. If there are any liens or debts on the property that were not paid off by the estate during probate, they will remain on the property until they are satisfied by you or the creditor. Some common types of liens and debts that can affect inherited properties are mortgages, home equity loans, tax liens, judgment liens, mechanic’s liens, and homeowner’s association dues.
Maintenance and Repair Costs
Inheriting a property in Florida means that you are responsible for maintaining and repairing it. This can include regular expenses such as lawn care, pest control, utilities, insurance, and property taxes, as well as unexpected expenses such as roof leaks, plumbing issues, electrical problems, and storm damage. The average cost of maintaining a home in Florida is $16,097 per year4, which is similar to the national average. However, this cost can vary depending on the size, condition, age, and location of the property. If you inherit an older or neglected property, you may have to spend more money on fixing and updating it.
Mediation Expenses
Sadly, when a loved one passes away, disputes between family members can arise. If you have siblings or others with a claim to the estate, you may find yourself dealing with mediation fees. A quick way to resolve this is a buyout or a fast sale, dividing the profits. Junard, Inc can facilitate a fast and fair sale of your property, closing in a matter of days. This solution has saved countless families from having to deal with mediation or court.
While these are just a few of the costs to own a home, there are more to consider. You will need to pay for appraisals, cleaning, listing fees, and more. By selling the house quickly and as-is, you can save money, while liquidating the property much faster.
Sell Your House to Avoid Costs
Probate fees. Probate is the legal process of settling the estate of a deceased person and transferring their assets to the beneficiaries. Probate can be expensive and time-consuming, especially if the estate is large, complex, or contested. According to the Florida Probate Code1, the personal representative (executor) of the estate is entitled to a fee based on the value of the estate, ranging from 3% for estates up to $40,000 to 1.5% for estates over $10 million. Additionally, the personal representative may have to pay for court fees, attorney fees, accounting fees, appraisal fees, and other expenses related to probate. These fees can reduce the value of the inheritance and may even exceed it in some cases.
How Junard, Inc Can Help
Do you have questions about inheriting a property in Broward County? Junard, Inc can help you find the answers you need. We understand that it may be a difficult time, and we are very compassionate and understanding. We will never talk you into a deal that isn’t right for you – we will simply give you the facts and leave the rest up to you!
Inheriting a property in Broward County can come with costs you may not be prepared for. Junard, Inc can help you with any unwanted inherited property in the Broward County area, making the process simple for you. A direct sale to Junard, Inc will allow you to sell quickly, without any costs or headaches so that you can utilize your inheritance without any more stress. Give us a call today to learn more about how we can help with your inherited property in Broward County. (954) 464-7159