Inherited homes in Maine, what to do with the real estate now that Mom and Dad, or whichever family member is gone?
When the time finally arrives and the loved one that owned and cared for the place won’t be using the property in Maine anymore.
Here is needed information on estate taxes in Maine as you delve into the homework stage of how to handle best the inheritance puzzle.
Lots to consider as you go through the important papers tucked away in the antique writing desk. To select an attorney, get everything in the probating of an estate underway. Effective January 1, 2016 there were changes in the Maine estate tax regulations. The rules to play by. The most significant change caused the Maine estate tax exemption increase to be equal to the Federal estate tax exemption.
The current Maine estate tax exemption of $2,000,000 means any Maine estate for a person who died in 2015 valued at less than $2,000,000 is exempt from Maine estate tax.
The Federal exemption level in 2015 was $5,430,000. The figure rises each year at the rate of inflation.
In 2016 both the Federal and Maine estate tax exemption increased to $5,450,000. Consult a qualified tax expert when running the numbers and to get the maximum due you in the inheritance of an estate. And for advice on how to estate plan the best route possible in your own personal always unique situation.
Also, what about that 2.5 % withholding tax on capital gains in Maine real estate sales?
Maine dot gov weighs in on the withholding tax details for your property sales if you are not a resident of Maine. And the sale price is $50,000 or over on the transfer paperwork that accompanies the real estate title deed carried up the court house steps, trotted into the registry of deeds. For recording, put on record for the World to see in the switch to a new owner(s).
So back to the Maine real estate end of the inheritance. You have three choices of what happens to the inherited real property in Maine. If you and your family inherited a home in Maine, one or all of you can move into it yourself and keep it. Use it for vacations, taking turns like a time share when time for some rest and relaxtion is carved out of the daily grind.
You could drain the pipes for plumbing and heating if a baseboard system is in place at the vacation home in Maine. Or keep it heated over a Maine winter until everyone decides what is best as a group to do with the property you all own collectively. You just lost a loved one so easy does it in the snap decision making is always prudent right?
You could rent out the property to others until you retire and need it yourself later in life.
What if you were an only child, if there is no one else to divvy it up with because you are the only one in line for an inheritance? You can sell it and use the money all for yourself. Donate some to your favorite charity to benefit others.
Or split it up among any family members named in the will or that you decide should be cut in after expenses from the real estate sale, other assets turned into cash proceeds from the estate.
For all to use as their share for something else needed closer to where you call home now since you, others moved away from the childhood house with all the memories attached to the property.
When you poll the family members that inherited the property in Maine, your brother needs financial help with too many kids in college at the same time.
Your sister wants to travel. Your own home sweet home out of state is begging for a new roof or heating system. Some family member just got a pink slip and their employee closed his doors. Went out of business. Or paying off an existing mortgage to live debt free is the plan for all that stand to inherit a chunk of change when the assets of an estate are liquidated, the funds dispersed.
When there are a bunch of family members involved in an estate, the choices of what to do with the inherited real estate or any asset suddenly becomes more limited.
Keeping everyone happy as the personal representative of an estate is not always an easy task. Even if the deceased property owner spells out in a will or trust what they want done with their real and personal possessions after they die. Time tables of folks vary from needing their share yesterday to take your time and no rush in the big check being cut by a law firm in the sale of the assets.
Maybe you inherited just a property that turns out to be a piece of land in Maine that Dad, Uncle Charlie that had no kids of his own loved to visit. On trips up to Maine. Or wanted to visit on vacations. Hunting, fishing, spending time in the great Maine woods was the plan. Maybe they never built on the land and life slipped by or there was a humble camp or cabin for vacation use.
Maybe what you inherited if you were really lucky was a lake house in Maine.
Something bordering the ocean, river, pond. A condo on a ski slope. Log cabin with a jaw dropping view or sunk down in disrepair in a swamp or bog. But regardless of what you inherited, now what do you want to do with whatever you are the proud owner of in Maine if it is a property with real estate attached?
Usually the first concern newly inherited property in Maine real estate owners wonder about is do I owe any taxes in the estate?
Is there any money in the estate to pay them and other expenses? Rounding up the inventory of assets, the expenses or liabilities is the first order of business in settling an estate. The worry about taxes are the kind accessed by the state. The IRS on the federal level for an estate. Or the local municipality itself demanding their version of property taxes levied against the place.
Are there back property taxes on the real estate that the family inherited?
Then worry and concern begins about if that approaching third year’s worth of delinquent property taxes are not settled up in time, the town or city is going yank it away.
To own the property for lack of property tax payment and planning to put the place up for municipal auction.
Because the lien matures against the place from the folks generating the annual or semi annual real estate tax bill. That is created, stamped, mailed out to the last known address of whoever owned the property as of April 1st. It is your duty as the property owner to find the town office for the tax bill and not the other way around.
Never think gee, no bill, no property taxes in Maine due this year.
The property taxes keep right on accruing with or without payments. What is that expression about the only certainities in life… death and taxes?
The real estate taxes based on the property’s assessed value and needed by the town, city, plantation or unorganized township where it is located to keep things rolling on the local level.
If it is decided that a sale of the inherited property in Maine is in the best interest of the estate or the only option because money is tight to maintain it, what happens next?
First things first, the contents of the house if there is one attached to the land needs to be cleaned out. Or sold “as is” where the good, the bad, the ugly as part of the trade. If the buyer does not want the contents, we often find a charity or an individual that will buy the contents and clean the place out wall to wall.
Usually leaving the appliances unless they are harvest gold and better go to the trash heap because they are on their last legs, plain worn out. Hard to get parts for too.
Why haul them back to PA, RI, CT, NY or wherever the personal items you want to keep are headed?
Where they will end up getting hauled a second time to the junk heap at the local recycler or worse needing someone to write a check for so much a pound to dispose of the treasure from Maine. Moving is expensive regardless if it is people or personal property.
What about if the family inheriting the property in Maine just can not make up their minds on what to do with the real estate? Making sure it is winterized, secured and keeping it insured along with maintained becomes a concern to protect the investment. Luckily Maine is the 4th lowest crime state. And where I live, work, play in Aroostook County, the crime stat is cut in half again.
If the roof is leaking like a sieve, the basement sub-pump not working, attention to those property weakness, problem areas is the paramount concern.
To protect the property’s value and not let things slide to end up doing costly damage to the sticks and bricks. Who is plowing the yard, mowing the grass, paying the utility bills? Who is deputized into checking on the empty house inherited in Maine and sitting without a soul inside?
Neighbors are a good thing if they are around and don’t fly the coop for Florida or go into the hospital.
A winter watchmen that calls a number if the temperature dips too low or the furnace conks out is a pretty good investment. During winter in Maine when the temperatures sink a little lower in the glass tube.
If the inherited property is land, what about keeping the open land bushed hogged, hayed or farmed in some way?
To keep the golden rod, poplar trees and burdocks scrub brush from growing up and for a little income to pay those pesky property taxes that never stop.
Continuing the rental year to year agreement with the farmer down the road could be a smart maneuver with the Maine land inheritance.
Until a more permanent arrangement can be ironed out for all the parties involved in some way with the land you stand to inherit once the legal paperwork is completed. All the forms filed, the estate finally settled.
Maybe if the family members don’t need the money from the Maine estate inheritance, in the case of a large property acreage, developing it could be in the real estate cards you hold. And you decide is the best next play with the property acreage headed your way for all or part ownership. Adding to the value soil testing, surveying and creating dotted lines until the planning and zoning boards okay the division.
Is the land in Maine inherited best served by dividing the real estate?
Is that best course of action,if all that valuable road and water frontage could be maximized in cutting it up into smaller parcels for resale. With possible owner financing added into the property sale to maximize the return like an annuity for the estate share holders to increase their wealth.
Sub-dividing the land in Maine to create smaller lots that sell for more money per acre is always a good investment choice.
If you find yourself in the position of inheriting property in Maine and need help with renting it, selling it or just maintaining the place. Here to help in whatever direction you decide is best to take with the real estate left to you by a loved one. Rent it for now, sell it right away. You have lots of options on the best course of action with the real estate inherited in Maine