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How to deal with inheriting multiple rental properties with siblings?
My husband's father owns about 60 rental units. They will eventually be inherited by my husband and his 2 brothers. My husband and 1 of his brothers currently work maintaining the properties, the 3rd works on his own. Thankfully their father is currently mid 60's in good health, so we should have some time before this happens.
Basically the family rarely to never talks about the plan of inheritance, such as who is executor and what the plan is for the 3 brothers to go forward from inheritance, or the plan for his long time girlfriend's provision. I'm afraid it's going to be a huge mess and cause strife between the family if there is no plan. His father always says "don't worry about it, it's taken care of" so we do not have a clue. We believe he has a will, but no idea what else.
We will continue to try to talk to my father in law about his plan, but we may not get the answers we need from him. Would love to get opinions on inherited rental property, how you divided between multiple siblings, what problems you have had. What are some ways we can prepare for this eventual inheritance?
I'm wondering if the people saying it's "none of my business" have ever been married?! I see us as ONE unit, so yes I do consider it OUR business. I should add that I most likely will be taking on the role of property manager within the next few years as the current one retires.
I am not "counting" on the inheritance and we are doing quite well on our own. My hope was for suggestions for people who have inherited property, what we can expect if and when we DO inherit.
27 Answers
- zipperLv 72 years ago
Unless there is a will stating other wise the court will divide the units up as equally as possible between them, there is very little for you to be concerned about. If pop says one son gets 15 units, another gets 25 and the third gets 20 that is the way he wants it divided up, he could choose to leave one son out of the mix, that would be up to him. If the court gets involved each will get a third, unless the wife is still alive, then she would get 1/3 to half and the rest divided between the brothers. There is very little for you to do or worry about: YOU GOLD DIGGER!
- GEEGEELv 72 years ago
Ideally the properties will be allocated to specific sons and not as a bundle to all 3 as a grouping.
As others have mentioned, finding out who will be the executor of the estate will be beneficial, and your FIL might be inclined to talk to that person privately re the estate.
- TedExLv 72 years ago
You can best prepare by all of you seeing a lawyer who specializes in wills and estates
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- JudyLv 72 years ago
There might be a lot to be said for dividingup the properties rater than joint ownership.
- Beverly SLv 72 years ago
Best way would be to divide the properties up rather than have all 3 brothers own all 60 properties.
- ?Lv 72 years ago
I guess the obvious thing to do is for the father in law to put the properties in a series of LLC's and then give the different LLC's to the different sons thru his will so each gets their fair share, which may be approximately what he has already done when he says "Don't worry about it." The rest of the estate would also be divided per his will and hopefully he has chosen a competent executor to handle the transition. The gf will hopefully be taken care of via the will, as well.
He could additionally gift the LLC's to his sons (in pieces not exceeding about 15k per year to avoid gift taxes) over the years until he passes away but so long as the value of his whole estate is below about 11 million (the exact number changes yearly) there is probably no tax on it anyhow so no need to be gifting. If the total value is more than 11 million or is even close then he may want to start gifting to avoid future tax when he passes away.
My advice, since he seems to think its all taken care of and he clearly doesn't want you to do anything, is to just tell him you are concerned about taxes and fairness of the inheritance and could he give you the basic plan. If he will, that's fine, if not, well what can you really do if he doesn't want your help.
- Casey YLv 72 years ago
Step 1...get your husband to handle this with his brothers...you should not be involved.
Step 2...have your brother at least find out who is executor of the will....that's all that really matters. Everything can be a secret until he dies.
Is he at least gifting?
- D.E.B.S.Lv 72 years ago
You can spin this with him as wanting to know for planning purposes, but this is your father in law's business. Do you know for certain his kids are getting anything? Or is it being donated somewhere instead?
There are plenty of ways to handle this from a trust to a will to having a company set up which owns the properties. If he isn't willing to discuss it, however, then there is nothing you can do but worry.
---edit---
This has nothing to do with being married. If this were your father and your were not married or not the answer is the same. Will and trusts are not always public. Some people don't want their wishes known until after they pass. If he doesn't want it known, that's his business.
The bigger concern is that you're doing work for him now. How you are compensated for that is a here and now question. If the answer is that you get no compensation now or that part of your compensation is the promise of an inheritance, THEN you can push him on how that is set up. With that many properties, I would assume this is not a personal asset of his and that he has some sort of LLC set up. That means ownership of that LLC would need to be transferred upon death.