Hi,
My mother is giving her house to my brother and I via her will upon passing. It will be a 50/50 split between the two of us. Both my mother and brother are Canadian citizens with no U.S. ties. My mother lives in Ontario. I am a Canada/U.S. citizen living in the U.S. and non-resident for tax purposes in Canada.
What would be the best strategy tax wise? For example,
1. Should we inherit the home via the will?
2. Should my brother and I get ourselves added to the deed now while my mother is still living?
3. Is there a better way than the above two ideas?
My mother is actually the one having me ask this question, as she wants it to work out the best possible way financially for my brother and I. Personally, I hope she lives forever!
Thanks
Best tax strategy for inheriting a house
Moderator: Mark T Serbinski CA CPA
I would only point you to the following article:
http://www.thebluntbeancounter.com/2014 ... unter.html
Read this article, as well as the others that he points to.
http://www.thebluntbeancounter.com/2014 ... unter.html
Read this article, as well as the others that he points to.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing
Re: Best tax strategy for inheriting a house
Hi nelsona,
What if my mother had to move into an assisted care facility and thus sell the home to fund that? Given the exact same setup as described in the first post in this thread, what would be the best strategy for my brother and I to receive the remaining proceeds from my mothers home upon her passing?
I've heard of people dividing the home sale amount into two separate GICs and then adding one child as joint owner on one account and the other child as joint owner on the other. Not sure how that affects me as a U.S. resident and a non-Canadian resident.
Thanks,
Peter
What if my mother had to move into an assisted care facility and thus sell the home to fund that? Given the exact same setup as described in the first post in this thread, what would be the best strategy for my brother and I to receive the remaining proceeds from my mothers home upon her passing?
I've heard of people dividing the home sale amount into two separate GICs and then adding one child as joint owner on one account and the other child as joint owner on the other. Not sure how that affects me as a U.S. resident and a non-Canadian resident.
Thanks,
Peter
Re: Best tax strategy for inheriting a house
Once she sells the house, does it matter how you get the money? Take your portion of cash and move it to US and invest it , buy a car, whatever.
What's the reason for leaving it in Canada? If you are worried about exchange rate, leaving it in a GIC loses far more potential income than any possible exchange rate issue. Invest in Cdn companies that trade in US if that is a concern.
And why have "joint owners" of 2 accounts? You have your money, he has his. Why tie yourselves to getting each others permission to do anything??! Am I missing something?
What's the reason for leaving it in Canada? If you are worried about exchange rate, leaving it in a GIC loses far more potential income than any possible exchange rate issue. Invest in Cdn companies that trade in US if that is a concern.
And why have "joint owners" of 2 accounts? You have your money, he has his. Why tie yourselves to getting each others permission to do anything??! Am I missing something?
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing
Re: Best tax strategy for inheriting a house
Hi nelsona,
Thank you for the reply.
I guess I wasn't thinking about taking the money right away as I wasn't sure whether there were any tax/inheritance/gift/etc implications. In other words, what is the best strategy to follow.
If my mother sells the house and goes into an assisted living residence, her house will likely sell for $600,000 to $700,000. My brother and I would get equal portions, likely leaving a a separate portion of the money to fund my mother's assisted living residence cost.
If you are saying that the money from the sale of the house could be given from my mother (who is the sole person on the deed to the house) to my brother and I immediately upon sale, then I agree that would be best. Like I said, I wasn't thinking that way as I did not know of any tax or gift related implications, especially given the fact that I am a U.S. resident and not a Canadian resident.
Thanks,
Peter
Thank you for the reply.
I guess I wasn't thinking about taking the money right away as I wasn't sure whether there were any tax/inheritance/gift/etc implications. In other words, what is the best strategy to follow.
If my mother sells the house and goes into an assisted living residence, her house will likely sell for $600,000 to $700,000. My brother and I would get equal portions, likely leaving a a separate portion of the money to fund my mother's assisted living residence cost.
If you are saying that the money from the sale of the house could be given from my mother (who is the sole person on the deed to the house) to my brother and I immediately upon sale, then I agree that would be best. Like I said, I wasn't thinking that way as I did not know of any tax or gift related implications, especially given the fact that I am a U.S. resident and not a Canadian resident.
Thanks,
Peter