My parents own a lot of acreage. What is the most beneficial way, tax wise, for them to leave the land to us?
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My parents own a lot of acreage. What is the most beneficial way, tax wise, for them to leave the land to us?
If possible we would like to keep it in the family once my parents pass. However I am sure the inheritance taxes would be prohibitive, not to mention the property taxes. My sister mentioned putting the land in a trust, can you address the pros and cons of that approach? How would it be handled if some siblings wanted to sell and others wanted to keep it in the family?
Asked on June 6, 2009 under Estate Planning, Texas
Answers:
MD, Member, California Bar / FreeAdvice Contributing Attorney
Answered 14 years ago | Contributor
We cannot simply answer this question herein. What you are seeking is legal advice and we cannot provide exact legal advice to you based on a mere question herein, unfortunately.
How many siblings? Are your parents currently ill? Do they have any current estate plans? Other property? Every state is different in terms of whether it has estate tax or property tax issues. More often than that, a trust helps protect assets from probate, as opposed to a will or no estate plan.
In terms of the pros and cons, etc., you need to sit down with a lawyer in the state in which the property is, with your sibling(s) and your parents and go over every detail (bank accounts, other land, homes, cars, personal items, etc). Why? Because up to a certain point, items can be exempt from taxation -- inheritance tax. Also, every year, your parents can give you and your sibling(s) cash up to a certain amount with no gift tax consequences.
So, you see, it is actually more complicated than what first meets the eye. Try www.attorneypages.com and consult with an estate planning lawyer in Texas. Check his or her record at the Texas State Bar.
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