When a close family member passes away it can be a very difficult and strenuous time. Within this hard time, it may be necessary to resolve some issues and such as inheritance. Is it necessary to deal with the inheritance process before it is too late?
Inheritance in terms of law is the practice of passing on property, debts, rights and obligations upon the death of an individual in a Will which is also known as a final testament. A Will is a legal declaration document that helps a person to express their wish including the names who are responsible to manage their estate and provide for the transfer of property at the time of death. Although a difficult discussion, understanding your rights and opportunities can help relieve some of the burden.
For example, you inherit a large piece of land in the form of will. If you are new to inheritance, multiple questions might be popping up in your head. At times people tend to carry-on with the proceedings single-handedly but that’s not recommended; legal advice is a must. Inheritance, not being a routine incident, must be taken care of so all details are in place and proper diligence is carried out. A transfer of name is a must to own the inherited land, therefore you should be mentioned in the will as the transferee. Also, before making a claim, you need to cross-verify that there are no outstanding debts or any further division of the inherited land is required by law.
Are you aware of the inheritance laws?
Well, to begin with, they vary from state to state. They are those statutes and regulations affecting who is entitled to receive what from the estate of the deceased relative. Some relatives, such as spouses and children, have a right to claim an inheritance and can even do so despite the expressed terms of a will. As Matthew Kreitzer, attorney at Booth & McCarthy states, “there are probate rules to consider, and issues related to the formation of the will.”
Things you should keep in mind while inheriting land:
Transfer of property, Class I Heir, Class II Heir and mutation of property title:
• Transfer of property can only be done if you have generous evidence to claim your inheritance.
• Class I heir includes the widow, children and mother
• Class II heir includes father, grandchildren, brother and other relatives.
• Mutation of property titles is done to record the transfer of a title of an immovable property from one person to another in the land revenue records.
Once the process is completed, you most likely feel ultimate relief. There just 3 steps
(Legal ownership, documents and liabilities), and they might take up to several months to be completed. If the beneficiary values privacy in property ownership or simply wants to own the property as part of a joint group, a land trust may be the best solution. Once the inherited land is all yours, you might have the following 3 things on your mind that might cause some confusion:
Keep:
Most of people tend to keep the inherited land as a sentimental link to family. If you can afford the associated costs of your inherited land, you can hold and enjoy it!
Build:
Some people use the inherited land as a golden opportunity and build something commercially or residentially. This would require you to seek and contractor to assist you on bringing your plans to fruition.
Sell:
People who stay away from the city or country sell it off as it’s difficult to maintain from a far distance. Many times, this can be a lucrative decision.
Can you sell your inherited land?
In order for you to be able to sell a property that you inherited, you would need to be authorized as the seller/Grantor through a Deed in your name, and/or you would need to be the Trustee of a Trust or an Executor of an Estate. Keep in mind that if you choose to sell it off, you might be liable to pay zero or no taxable capital gain.
Understanding capital gains is no huge task. Capital Gains is when you sell any asset that you own (house, land, shares, mutual fund units, gold, debentures, bonds) and make a profit. Short-term capital gains are calculated by adding it to your total income. Depending on which tax bracket you fall under, you will be taxed. It all depends on the situation; the inherited land might be a dream come true or a burden. The inherited land can either be a sentimental attachment or simply an investment property that can make a big difference on your life. It’s your decision about the role you would like to take with the inherited land. Make the decision that favours you the best – Keep, build or sell!
