Research is needed to buy deceased neighbor’s unlisted home
Q: A neighbor I didn’t know died three months ago. Her house has been vacant. I heard she has a daughter but don’t know how to contact her and have never seen anyone at the house.
My daughter is looking to purchase a house in my neighborhood and has been working with a real estate agent. How do we find out whether the house is going on the market soon without seeming insensitive to her family?
I have another neighbor who is a contractor. He seems to have the inside track on houses in our area that will be turning over. He has purchased houses before they are listed by a Realtor, then rents them. I’d love for my daughter to have the first opportunity to see if this house is the right fit for her family. — L.T.
A: After three months, I don’t think you need to worry about sounding like ambulance chasers.
Has your daughter spoken with her real estate agent about that vacant house? Sometimes an agent can do a little sleuthing to locate the administrator of the estate. Perhaps a lawyer could. Perhaps there was some clue in the obituary notice.
Your daughter can mail a letter to “Estate of Neighbor’s Name” at that address, or stick a note in the front door, expressing her interest in the property.
No Capital Gains Tax on home
Q: I was delighted to read in your column that “if you’re in the lowest tax brackets (ordinary income less than $73,800) you pay no tax on capital gains.” I called Internal Revenue Service to verify and the agent stated, “That’s false.”
We are elderly, with income of $1,050 annually other than our Social Security. We have a second home, which has never been rented out. We were holding off selling it until we sold our primary home, with the plan to live in the second home for two years (for tax purposes) before selling it. We really need to sell it now, before we die. — via askedith.com
A: If you are in the 10 percent or 15 percent tax bracket, the tax on your long-term (more than one year) capital gain is indeed zero percent.
The question you refer to came from a married couple filing jointly. The $73,800 figure I mentioned is their top income limit for the 15 percent tax bracket in 2014. Perhaps the IRS person you contacted was thinking of the 2013 limit, which is $72,500. Try calling it again.
Getting Off the Parents’ Mortgage
Q: My spouse and I co-own a house with my parents. However, we would like to get our names out of the title and the mortgage loan and transfer this property entirely to my parents. Is that possible or would we still be tied down to the loan? — G.
A: Turning over title is easy — you just sign a deed naming your folks as the only owners. Removing you from the debt, though, requires your lender’s agreement.
Who’s been making the mortgage payments? Can your folks show good credit and enough dependable income to carry the payments comfortably? What kind of mortgage is it? All of that may make a difference.
In some situations, a lender may agree to remove your names from the loan if your folks can demonstrate, maybe with canceled checks, that they’ve been making the payments themselves for a year or more. The place to inquire is with your mortgage company.
Cost Basis on Gift
Q: Could you provide more information about determining cost basis for property received as a gift, when giver remains in home? My mother gave her home to three children. She lived there until age 89, when she moved to independent living. We maintained the home and took her there frequently; she always thought she’d move back one day. Our lawyer has advised us, twice, incorrectly. We also received incorrect information from a certified public accountant — via askedith.com
A: I’d suggest consulting yet another lawyer, one who specializes in income tax matters.
Edith Lank will respond personally to any question sent to www.askedith.com or to 240 Hemingway Drive, Rochester NY 14620
