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Everything sells at the right price. Lets say you rent it and the rent does cover your loan amount. You will have to pay capital gains on the property when you sell it unless you live in it for two years prior to selling. What's the sense in putting yourself through the stress of being a long distance landlord and only moving sideways or worse yet not making a profit at all? I say sell it. I've been a landlord since 1990 and it's not an easy road, and I've done it debt free and hands on. Try making a couple of mortgage payments when no one wants to rent the property or you don't want what the market has to offer. I left one property vacant for nearly a year after it was rehabbed and pristine waiting for the right tenant. Think about all the pros and cons before you decide. Do your homework.
Everything sells at the right price. Lets say you rent it and the rent does cover your loan amount. You will have to pay capital gains on the property when you sell it unless you live in it for two years prior to selling. What's the sense in putting yourself through the stress of being a long distance landlord and only moving sideways or worse yet not making a profit at all? I say sell it. I've been a landlord since 1990 and it's not an easy road, and I've done it debt free and hands on. Try making a couple of mortgage payments when no one wants to rent the property or you don't want what the market has to offer. I left one property vacant for nearly a year after it was rehabbed and pristine waiting for the right tenant. Think about all the pros and cons before you decide. Do your homework.
It was more for us get us someone to rent the house out & let a real-estate agent handle it all. I know they take a part of that. Take out said amount of loan & travel for a bit letting the renters pay off the loan for us. Nothing crazy but it would be enough to let us do some costly thru hikes. Say 15,000 enough money to get there & back of course any emergencies that might come up. From the sound of it though like others have said it might be better to just sell it out right. There is a IRA that's also in the trust not a huge amount but some to put into retirement. It's earning 3% interest now a bit more then that to be honest but I can't recall how much more. Everything is up in the air right now & we do use our free time to do research.
How about making a list of all the possible scenarios and listing pros and cons on each one? Sometimes putting things in writing or in a spreadsheet will make one choice really pop up as the most desirable.
Many wise people employ legal strategies, such as trusts, to protect and conserve assets.
Using every lawful means to protect, conserve and increase assets, while minimizing taxes, is how people can become wealthy. Knowing of such strategies, and failing to use them, is foolish.
Being ignorant of these things can be cured through education. If you want to be wealthy, learn what wealthy people do, and do likewise.
Libraries, bookstores, and the internet are resources by which one can become educated in order to cure ignorance.
Not to use [freely] available resources is stupid. Unfortunately, modern science has not yet found a cure for 'stupid', and many people will continue to complain about what others have, and which they could have for themselves for the price of a little effort...but they will never have it because they choose to continue to sit on their butts in front of the TV and complain about what they don't have instead of doing something about it.
So while people are using every means necessary to protect and conserve assets for the benefit of their children, who pays the end of life bills?
One would only pay taxes on the income that exceeds the costs of maintaining and managing the property, subject to variations depending on other incomes and laws.
You say that like the idea of having an income on which one must pay taxes is a bad thing. Do you not have an income? Do you not pay taxes?
In general, having an income is a good thing, even if one *does* have to pay taxes on it.
Of course I have an income and I pay taxes. This thread isn't about me.
Many people don't realize that they have to pay income taxes when they own rental property. There is only some much you can write off. If you're losing money on a property, it's not worth having!
I would sell the property. If it is not selling there could be a couple of reasons why. How is it priced. Who is marketing/selling it? Are they doing all that they could? How does the house look? It may be worth the effort to check it out. Contact another realtor who specializes in like properties in that area. Do a drive my. How does your house look? Is it cozy looking? Curb appeal has everything to do with how soon you will sell it and what price you will get. Look at the houses in the area? How much are they selling for? Who is selling them? It seems like you may want to offer the listing to another brokerage. I made several thousand more by chaining my agent when the first one failed to do so.
Rental income can be a good idea or a really bad one. I would hire or interview at least a property management company in the area where the property is located. Once again, you will probably see a few "for rent" signs when checking out the neighborhood. They can best advise you on if it is a good idea or not in your particular situation.
So while people are using every means necessary to protect and conserve assets for the benefit of their children, who pays the end of life bills?
It's as much about quality of care and quality of life as it is anything. $100,000 will buy her two years of institutional care in a low-cost area of the country, such as the one in which they seem to be located. On the other hand, she won't get the free exercise of running away from sonny or chasing after the chickens in the 2nd lot. Free eggs are a good motivator for exercise.
Despite your other thread-which has nothing to do wiht this one-, here is a tale of property inherited.
I have a duplex that my grandmother left my mother, who left it to my father, who is leaving it to me. It is down south, we are in NE USA.
1} it costs to have an absentee landlord management company to manage it {LAW} Check out your state.
2} we had to set up a $5k account for "necessary expenditures" for the duplex.
3} they take the first month's rent, then 25% of the monthly rent each month for fees,and the last month rent. Expensive as it goes.
4} there rarely is both sides of the duplex rented at the same time. They Mgmt company figures one side rented is better than none. You won't have that problem, but it can also mean a single unit may not always be rented.
5} One tenant cleaned out the unit...lock stock appliances and electrical covers and light fixtures!She claimed "I'll be long gone before you can sue me"...she was right.
6} in the event of an emergency, they charuge for repairs immediately without shopping for estimates. After a hurricane the roof needed replacing, It cost us twice as much as the first roof was not put on right and leaked, and the MGMT company required us to pay twice. {$5k once wrong, and $7500 t to fix one on right later.}. THAT comes out of our pocket!
7} one year we had a hassle as they sent TWO forms showing 'rent income" to the IRS, it was a mess to get straighten out with the IRS.
8} when the appliances break,instead of fixing them, they install new ones and take the money out of the $5k emergency, then send us the bill to want us to replenish the E. fund. That includes the stove, fridge, dishwasher, washer and dryer...Even when the tenant ruins them by putting non-dishwasher safe plastic in the DW that melted into the drain system. They will hire expensive professionals to do any work, and probably get kick-backs.
9} WHY do we hold onto it? my father wants to give it to me as inheritance, hoping the market will improve and I can get a tidy sum for it, right now it about breaks even!! So DON'T count on "travel money" for it.
10} The area of town is no longer a better section.
11} One CAN deduct one trip to an out of state rental property to "look after it", but is it worth it since it about breaks even?
12] it was inherited mortgage free,but still only about breaks even as the MGMT company only concentrates on renting one side out, instead of both,even though they would make more money that way.
13} I drove by on a trip down there once, and although they are NOT to have dogs or cats, it was obvious from the markings of mud and scratches on on the door and the barking that they had one-and a larger one at that. Instead of going to investigate, the mgmt company called the tenant who, of course, said "no, I don't have a dog". WE could possibly be held responsible if the dog bit anyone as it is on our property.
14} there is a "cleaning/painting fee of $750 between tenants to us.
In short, don't expect to make gobs of money,,the mgmt company will. You will get anyone who can come up with the first and security renting it and not taking care of it. YOU won't get to choose tenants, they will. You will be responsible for all repairs, no matter how little or mundane it may be. YOU trying to manage long-distantly, even when the state doens't require a mgmt company to run it for out of state Landlords, will FAIL most likely and fail miserably!
SELL it and get what you can and eave it alone for some other ******* to run.
That is the voice of experience talking. I will sell it when my father passes. At whatever reasonable price I can get. I will then buy a rental here where I live to rent out if I desire to be a land lord. OR buy my OWN house in a different state in the south for MY retirement.
Best of luck to you with your mother, wife and the house.
So while people are using every means necessary to protect and conserve assets for the benefit of their children, who pays the end of life bills?
Having dealt with this issue twice now, most recently just a few months ago, I have some knowledge of this. Laws may vary depending on the state, I know only the laws of the one state in which I have had experience.
If the decedent has not made preparations to pay for the event, then the heirs and/or executor of the estate who make the arrangements may become responsible, particularly if there is not enough money left after the liquidation of the estate. A property held in trust is not part of the estate, the trust is a legal entity unto itself. Accounts with named beneficiaries/survivorship rights are not part of the estate.
If the decedent incurs expenses before EOL, and they are not satisfied by liquidation of the estate, then the debtholders may get stiffed. Those debts are not the responsibility of the heirs (if any).
There may certain laws pertaining to the length of time that a trust must be in existence prior to death, and differences in laws as regards revocable and irrevocable trusts.
This is an extremely limited response that cannot take into account all of the laws which may apply, that could take hundreds of pages or more...which is why it is advisable to use a lawyer for this sort of thing.
Quote:
Originally Posted by ss20ts
Of course I have an income and I pay taxes. This thread isn't about me.
Many people don't realize that they have to pay income taxes when they own rental property. There is only some much you can write off. If you're losing money on a property, it's not worth having!
I question your experience because your advice does not seem particularly apropos.
One pays income taxes only to the extent that there is income in excess of the costs incurred in producing that income. Legit expenses can be deducted against rental income, if the costs of management are less than the income received then there is a net profit and taxes may have to be paid, but this is a good thing because that means that you are making money.
Obviously, if expenses exceed income then there is a net loss and no taxes are paid because there is a loss. To a certain extent, in some cases, the loss may be deductable against ordinary income, causing a reduction in one's AGI, which may also be a good thing. However, if the loss exceeds a certain amount or continues for a certain length of time, it may be advisable to review the situation and possibly change it, especially if the losses exceed [potential] appreciation in the value of the property.
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Everything is up in the air right now & we do use our free time to do research. 
