There is a lot of untrue information out there about estate planning. From thinking estate planning is only for rich people to thinking it’s only for old people reaching the end of their life, there are plenty of myths that need correcting.
It can also be confusing when deciding what and how to include your assets in your will, especially when it comes to tangible real estate.
Here are a few important tips that will help you understand the why and how of including real estate in your will.
Why You Should Include Real Estate in Your Will
If you have investment properties, it is a lot more obvious why you should include these properties in your will, but what if it’s just your current home? It’s just going to get passed down to the immediate member of your family anyway, so why include it in your will?
- It will prevent your home from getting stuck in probate
- You can decide exactly who to leave your home to
- It can prevent squabbling between family members when you’re gone
Have the Value of Your Property Assessed
Once you’ve decided to include your home in your will, you have to have it assessed. It’s a fairly simple process.
A professional assessor will come out to your property and compare it to similar properties in the area. The value they come up with will be a fair market value of your home.
If you don’t agree with the assessment, you can contest the value. It is important to get this assessment right so that it is listed in your will accurately, especially when it comes to this next tip.
Consider Who You Will Be Leaving the Estate To
Next, you have to think about who you will be leaving the estate to. This is a fairly easy decision if you have a living spouse or a single child, but things can get complicated fast if there are many people you might consider leaving your home to.
You can name multiple beneficiaries, as long as you understand that the property will be divided and potentially even sold after your passing by those people.
Tax Considerations
People make a lot of mistakes when it comes to planning a will. One of the biggest is taxes.
There are strategies you can use to reduce the tax burden on your beneficiaries. You can name a joint owner before your passing, so the property simply passes to them without tax considerations. A death deed is also an option.
To make sure you plan for the taxes that will result from your property passing into someone else’s hands, it’s always a good idea to speak with a professional.
Planning a will is a big job. It’s one that deserves to be taken seriously, especially where your home and other properties are concerned. With these tips, you can have greater peace of mind knowing you included your real estate in your will the right way.
