Okay, I’ve been thinking. The house Paul owns with his sister is in very poor shape. VERY poor shape. When Paul went there for the funeral, he said he was advising his sister to move out for SAFETY, and he estimates nothing’s been repaired or maintained since his dad left his mom two decades ago. Let that sink in a minute. TWO DECADES. Furthermore, it’s in an area of the country with extremely low cost-of-living, and real estate prices are very low anyway there.
So let me run something by you: Would it be CRAZY to just GIVE his sister the house? On one hand, this is wildly unfair to us. On the other hand, it is ALSO wildly unfair to have her live there year after year, possibly driving the house’s condition even further into the ground, while sending us bill after bill for half the repairs (including, for starters, REPLACING THE ROOF), and then eventually we sell it and after taxes and agency fees get enough money to mayyyyyybe make up for the money we contributed to repairs.
If we give her the house, we can cut it loose: we don’t have to worry about taxes, or repairs, or insurance, or ANYTHING. She can live there without us having to be connected to it, and she can pay for the repairs herself. We never have to think about it again. And, Paul can stop thinking of me as a Heartless Money-Hungry Fritch for suggesting his sister NOT live there rent-free while we pay half for repairs.
If the two options were (A) sell the house and split the cost, or (B) give her the house, I would obviously not even be considering Option B. But instead the two options seem to be (A) grind my teeth to nubs with frustration as she lives there for free and we PAY money into an asset we may or may not ever see half of, IN ADDITION to paying to maintain our OWN house, or (B) give her the house.
Tell me what you think. This is a good time for frankness. Paul and I have been having tense email exchanges all day, and I suspect a decision will soon be made because neither one of us wants to talk about it any more than we have to.
Give it. Give it give it give it. It sounds like a money pit, you aren’t going to get a nice windfall out of it, and it sounds like his sister expects to be continued to be taken care of. That’s a bigger suck that the money pit, frankly.
Giving it removes you from tax implications (would you really get that much additional back claiming half the interest? Is it paid off? Sometimes you have to PAY taxes on paid off houses), removes you from frustration and fighting.
Just be prepared for his oh, so responsible sister to ask for a loan when she realizes how much it will cost. That would be another fight though.
Honestly? I would totally give her the house.
I’d probably give her the house.
I think you would be better off giving it to her and walking away. But if she insists that you pay 1/2 the repairs and 1/2 the property taxes, then shouldn’t she pay you rent for the 1/2 of the house you own?
I would give it to her, as long as Paul doesn’t have any specific ties that he is really unwilling to break (to the house, not his sister). It sounds like financially it’s a wash, and emotionally giving her the house looks like the big winner, so that’s what I would do.
Plus, do not underestimate the liability of half owning a dilapidated house. What if someone got hurt on the property? You don’t want that reflected on your insurance, or to have to pay for it out of pocket.
since it sucks paul wont make her buy half (even though apparently it will be DIRT CHEAP for the sis since real estate is in the dumps and it’s also in an area here it would be DIRT CHEAP anyway) then i say give it to her. this sis isn’t gonna move out (why buy the cow kinda philosophy there)and you’re going to spend your money for your house and be angry. i say b)give it to her.
then laugh when she doesn’t maintain it and the roof caves in and the floors rot out and the….
oh i’m evil. and snarky!
Oy. Because it seems like she is reluctant to sell the place and it doesn’t sound like it’s worth very much to begin with, I’d begrudgingly give her the house, pointing out that everything is now 100% her responsibility.
And if she turns around and fixes it up to sell it for a tidy profit, then you can hunt her down.
(Do you know the amount of money you’ve put into that place in case she does sell it down the road after you’ve given it to her? Maybe you could make a deal with her: if she sells it, she keeps 100% of the profits rather than splitting it 50-50, but she reimburses you for the money you’ve put in for repairs…)
Everyone makes excellent points here. Give her the house. You are essentially acting as a landlord and even if you ARE getting rent from her, that is a situation that could turn awful. Quitclaim deed it to her and let her figure out whether she should sell it or not.
Give it to her! But make sure you find out your tax implications by doing that, gift taxes may apply depending on the value of your half of the house.
Give it and walk away with his (your) family intact. It isn’t worth the liability. Is it even insured or would you guys be footing the bill if it DID come crashing to the ground? I would totally get out.
Your other option is to get it appraised and have her buy you out, but ummm if she isn’t even paying rent, I’m guessing she wouldn’t have that cash either.
I don’t know how the will was written, but if the house was given jointly then Paul WOULD be responsible for half the repairs…but his sister should also be paying rent to the estate/whatever. Is one of them the executor or is there a third party that could help sort it out? Best solution is walk away, but I don’t know how it’s done. I would strongly recommend consulting a tax and/or real estate professional in EITHER case.
You must must must talk to a tax accountant or tax attornery before you decide. Either choice will have tax ramifications for you, and making sure that the title, and everything are properly recorded are CRITICAL. (would want to think you had given her Paul’s half and later find it wasn’t recorded and you were legally responsible for that roof, etc., right?) G’luck!
YEEEEEEESSSSSSSSS, give it!!! Why I didn’t say that earlier today is beyond me. Give her the mutha bleepin’ house. Great idea!!
meant “wouldn’t”. Wouldn’t want you to have either undesirable tax implications or liabilities for her or the house. :-)
Holly- THAT MAKES LOGICAL SENSE TO ME, TOO. AND YET.
I would give her that house and WASH MY DAMN HANDS OF THE WHOLE DEAL so fast. This whole thing sounds like a headache and I don’t envy you one bit. xoxoxo.
Heaven’s sakes, yes, give her the house. And just hope she doesn’t still ask for financial help with the repairs.
(And, by the way, in the other scenario, if you managed to collect rent from the sister, that is technically income that you are receiving, and therefore taxable. It’s hardly worth the headaches involved.)
As long as there are no unfavorable tax liabilities, I’d just give it to her and walk away. It sounds like way more trouble than it’s worth; both the house itself and dealing with his sister who seems to expect a free ride. You are better off without both of those things.
I would make sure that Paul has his pick of any sentimental items he may want, as well, before signing it over. Things you may want the kids to have someday. It seems only fair that Paul get whatever he wants since she’s getting the house free and clear.
Shari- No will. There’s a family friend (a lawyer) handling the estate stuff, but the problem is that whatever he tells them (recently he said, “Time to decide about the house”), Paul and his sister just make their own arrangements.
I’m with everyone else – just give it to her. Even if it is a little bit of a financial loss in the long term, you’ll be financially ahead in the short term (which, you know, if you were to invest that money or whatever, could be ahead in the long term too) and you’ll save yourself the angst of ongoing resentment.
If the sister lives there rent-free but still wants you to pay for half the repairs, then you can expect that her sense of entitlement isn’t going to go away, and it could get much worse when some unexpected expense pops up.
I agree with Annie Pazoo that you should seek professional counsel before you do anything, but I think giving her the house and walking away is the best thing to do for the sake of your sanity.
Your SIL sounds like a real treat. Must be nice to be able to live rent-free, even if it is in what sounds like a hovel.
I agree with those who have said they would be ok with giving her the house but that you need to make sure there aren’t any tax issues for you first. The only tax issue I can think of is that if you owned half the house and then gave it to the sister-in-law, you might be taxed as though you sold the asset. But you sold it for $0, so there might not be any impact for you. In fact, you might benefit on your taxes because you are taking a loss on the house. Keep in mind, I took one tax class like 8 years ago, so I am likely totally wrong.
How would you and Paul feel about giving her a choice
A. To give her the house
B. Continue as is but she begin paying rent as well and if rent doesn’t come in you refuse to pay your half of the repairs. I suppose you run the risk of her allowing it to fall into further disrepair…
Anyway, just another idea.
If this was a $50 million mansion I’d dig in my heels a bit. But in this situation, I think relieving the stress and ill-feelings will be much more valuable than the house would ever be. Walk away.
I’d say give it to her. There will STILL probably be gift tax implications, unless the house is really really terrible, but I’m only an estate planner’s wife and thus I know only enough to get me in trouble. :)
If it were me, I’d give it away anyway, just to wash my hands of it.
I would definately check with an accountant before selling as you may indeed have to pay a gift tax. If you do owe money, she should pay you for that expense. Did she get money from the estate when her mother died? I would ask her to compensate you for the repairs you’ve made. How in the world does she justify living there rent free AND asking you for repairs. You’re not going to want her visiting after this any more than you wanted her mother to.
If Paul won’t force his sister to sell (in my state, if one party wants to sell, it has to be sold), I’d be pretty darn mad (not the phrase I wanted to use) as you have 5 kids for crying out loud and even if you made $20,000 on it, that’s money his mother gave to her son and you could use. His sister could get a lovely rental so it’s not like she would be homeless.
Anyway, I don’t want you asking us about a divorce attorney so I’ll shut up now…..
Give her the house with the condition that she pay for the expenses you’ve already given over, attorneys fees and any taxes. (in my state there is a “transfer tax” but it’s based on the sale price) i hope Paul will at least agree to that, otherwise it will cost YOU money to give her the house.
What is the house worth really? You can think of it in terms of is it worth the time and aggravation of dealing with a crazy person from here till eternity/house being condemned? I remember you said something about not paying for a child seat on a plane and then after four hours with your child on your lap, you thought about money differently. Perhaps this is the way to filter this dilemma, too. Is the cost of a shabby house worth dealing with a nutcase? I’m sure Paul wants to keep a relationship with his sister and maybe this would be the way to maintain that relationship without the irritation.
I would give it to her, providing of course all the tax ramifications are null or in your favor. I am not exactly certain but if the house is valued high enough, you might bust the gift tax threshold (though I believe both you and Paul can gift to her so maybe you’d be all right on that end???).
But all tax things being equal, yes, if it were a choice between giving it to her and dealing with the constant repairs/taxes/etc. then I would choose the (relatively) easy way out, particularly if there is little to no financial benefit for me. I would STILL be annoyed but at least then I could move on, eventually.
I would give it, but that is a very uneducated opinion. I don’t know much about taxes and the like. But I do like the idea, if you keep it, of her paying rent for using your half of the house.
What I really think is that I could totally start a blog that lets me put my disagreements with my husband out to the internets to try and get some advice and perspective. (I mean this totally seriously, by the way. It might sound sarcastic, but it is not!) I really love this idea, and I’m glad you can ask us for help! :D
My first reaction was to say ‘give it to her’. But, even if the house is only worth, say $50,000 in its current condition, $25,000 (less taxes, fees, etc.) is still a lot of money to give up in the name of relieving your husband of having to have an awkward conversation. Honestly, I would want some of that money in my pocket.
I would maybe give it, though I would be bitter about it. Have you mentioned this idea to Paul yet? Because maybe the fact that your best option other than him manning up and having the necessary conversation is to give up thousands of dollars might make him snap to reality?
Give it, but be clear with her that you are giving her the house so she can “manage the repairs herself”. And you can make it out like you’re doing a nice thing by saying, “And then, when you want to move, you don’t have to worry about negotiating the sale with US involved!” But be very, very clear that she can have the house, but you are not responsible for helping her on repairs. Or then you’ve just shot yourself in the foot.
When she comes back later and says, Hey, I’m putting a new roof on the place–can you send a check for $XXXX? You can say, “Why, Sweetheart, it’s YOUR house! This is something that homeowners just have to do to maintain their investment!” Or whatever.
Good luck!
Sara Hammond- It is one of the HUGE perks of blogging!
Get rid of the house!!!! It will be best for you and Paul. Make sure you consult an accountant and make sure it is all legal and tidy so you are free!!!
Let me get this straight… someone GAVE you a house. It wasn’t owed to you, was it? You didn’t use it as collateral for anything, did you?
What do you lose by giving it away? A lot of angst, a lot of bills, and tax nightmares.
Free yourself from the shoulda-woulda entitlement nightmare and just GIVE it.
It would be nice if Paul could stop by and pick a couple mementos out before signing over the deed but in the long run, giving the house to her is a big WIN.
Determine your goal, then base your decision on that. And by your goal, I mean yours AND Paul’s. Is your goal to have made some kind of financial gain from having inherited this house? Is your goal to avoid a financial loss on this house? Is your goal to minimize house-related stress? Is your goal to help your sister-in-law, despite her crazy? If you can agree on what you want out of this whole debacle, it will probably be easier to figure out which choice is right.
OMG give her the house! Yes definitely check tax responsibilities for you if you do that; maybe you have to “sell” your half for $1 or something. I have no idea. But yes give it give it give it. It sounds like it would be difficult to sell anyway and this way you can just be DONE with it and it’s not like it’s something you’ve invested tons of money in or anything so no loss to you at all. Don’t be a landlord to your sister-in-law. NO NO NO NO NO. Being a landlord sucks and that’s WITHOUT family politics.
Having watched my mom & her brother go through this situation off and on for 4 years then another year while they each accused the other of yanking their chains while trying to sell it and my dad trying not to lose his shit while this went on and the water heater failed and the electrical didn’t meet code etc…
Give it to her. Sign what needs to be signed to make it legal and walk away. It could be years and years before there is any cash profit in the house & meanwhile it is draining your soul, your relationship & your bank account.
Somethings are just not worth a potential cash payout
I think for mental stress purposes giving her the house would be a great idea.
However, definitely check with a tax professional first since way back when dinosaurs roamed the earth and I did anything with individual taxes the giver owed gift taxes on anything over some amount – don’t ask me what it is today. So you and Paul can jointly give his sister X amount (in money, property, or whatever) without paying gift taxes, but anything over that will cause you and Paul to have to pay gift taxes on the gift (and they can be pretty steep). There is likely some way to structure this thing so you don’t have to do that, but it’s really important that you talk to a professional first.
I would totally just give her the house. I would check with an Attorney and an Accountant before doing so. Paul may have to pay what is called a gift tax for giving money or asset over a certain amount. This would probably fall under that.
What Annie said above. Talk to a real estate or tax attorney in the state where the house is located. Depending on tax ramifications you might have to “sell” the house to his sister for a small sum, like $1. Also make sure all the paperwork is done up properly.
But definitely get rid of the house either way. Of course selling it would be best, but barring that give it to the sister in law, just make sure it’s done in a way that won’t come back to get you. (taxes, liability, continued costs, etc.)
Good luck!
You could MAKE her sell, because like C C Donna said, in most states the default of co-ownership when one owner wants out is you have to sell. But if Paul isn’t even willing to work out EASY stuff then I don’t think forcing her to sell is going to make anyone’s life easier.
So YES, give her the house, with the clear understanding she is now 100% responsible for repairs. Although I’m guessing she might see that “gift” for what it’s worth and protest.
Also, tax stuff depends on a lot of things, but mainly how much half the house is worth and whether you AND Paul own it or just Paul. You’d probably have to have the house appraised before you quit claim deed it over to her, but if your half is worth less than $26,000 no one owes any taxes under the gift tax law. Or at least, that’s what Google says & what I remember from real estate licensing class. Don’t actually believe me.
Ahh, give it! Yes! What a great idea! And YES check with a lawyer, accountant, etc. (Any money you spend in doing so will be a FANTASTIC investment in your future mental and marital health!)
Having seen a family situation like this get out of control (and go on for 15+ years), I think if you can get out of it now with relatively little damage then DO EEET.
BUT. But but but.
Get it in writing. Have her sign something. Make it legal. It sounds like that’s the only way to make it stick with her. (And the only way Paul would be ‘able’ to make it stick.)
ALSO. I know squat about taxes except that there is usually a limit on gifting, as others have said. Ask an accountant and/or lawyer, but it is also possible that you could also sell it to her for $1, or something, to avoid all that.
(Also, you are very smart and Swistle-ish for thinking of this. This idea makes me feel very WHEW! about it. Good work.)
do whatever makes the most financial sense.
Oh yeah, I say give her the house. It seems like it would be way too stressful/draining on your marriage to keep paying for repairs.
I think that giving her the house will actually end up being the easiest thing in the long run. Seriously.
1 – I would be absolutely livid that she is not paying rent. It actually makes me red just thinking about it.
2 – I would give her the house. Make it legal!
Let me just add my $0.02 to the other 40ish people who commented: Give it to her. Totally worth it to never have to think about or deal with the situation ever again.
Chiming in with the majority to say, GIVE IT AWAY. Do what you need to in terms of taxes and getting stuff in writing, etc. (and here’s where $500 or so [right? it wouldn’t be much more than that, right?] to a well-recommended lawyer who is able to be CLEAR about things and ACTUALLY KNOWS THE APPLICABLE LAWS would be so totally worth it).
My grandpa’s house was like this. Falling down in many places. Located in rural Iowa, meaning that its market worth was approximately fifty cents. As a family we (meaning my parents, so I have no idea what the tax ramifications were) just gave the damn thing to my aunt, who sold it. Yes, she ended up with slightly more cash in her pocket than us at the end of the day–but you know what? That was cash that made our life worth living. And it wasn’t cash that we were counting on getting, or planning our own retirement around, or anything. You know? Sometimes the best thing to do is just donate that $10K you found in unmarked bags to charity.
[Does it help you to think of maddening family members as mentally ill people who need our charity? Um, me neither. I NEVER use this as a coping mechanism. NEVER.]
YES YES GIVE HER THE DAMN THING.
Save your marraige and give it to her.
But seriously–it’s not as if it’s the old family homestead that was willed to generation after generation (or was it??). It doesn’t really sound like Paul has an emotional stake in it and it seems crazy that he has to manage pieces of it from states away while she squats…erm…lives there. In the long run, maaaaaybe you could make a few bucks off of it, but I think it’s a long shot.
Give it away. Wash your hands. And when it is officially hers, send her a nice housewarming gift.
I am an estate planning attorney (in VA, but gift tax stuff is federal). I will try to give you a quick overview of the gift tax system that others referred to. Basically each person can give up to $13,000 (in money or other assets) each year to anyone else without having to pay gift tax or file a gift tax return (this amount is called the annual exclusion amount). If the giver is married, he or she can gift double that amount (so it’s like each spouse is giving the $13K for a total of $26K) but the giver (and spouse) must then file a gift tax return to report the gift (which is called a Form 709 and is filed in April of the year after the gift is made). If the giver goes over the $13K, it’s okay (the giver would need to file a 709 to report the gift), but you still don’t have to pay gift taxes because each person gets a lifetime gift tax exemption of $1M. I recommend that the first thing you do is find out the current fair market value of the house to see how much a gift of one-half will be. Depending on that amount, you two could make partial gifts each year so that you stay under the $26K. Income tax-wise, gifts are not taxed as income so his sister wouldn’t have to pay tax on the gift.
Yeah, gift tax is going to be the buzzkill here. You can only give $13K to any one person before that is going to kick in. Hardly seems fair for you to give the gift AND pay the tax.
Also I thought of ANOTHER reason why you need to sell it ASAP and that is your taxable gain on the sale. Since you inherited it, your tax basis is its market value on the date of your MILs death, and the further you get from that, the greater your chance of having to report a large gain on the sale if the value goes up. ESPECIALLY if you are pumping money into it.
Omg, this is WAY too blah blah blah for a Friday afternoon. I AM SORRY. This really is a mess.
I bet she sells the house as soon as you give it to her.
Maybe get an agreement that she must split proceeds with you when she sells but for every year she lives in it and maintains it your share would be less.
Worth much or not that’s a big asset to give away and very selfish on her part if she takes it without sharing the value with her brother. JMHO
Definately give it to her. I would get the house appraised and calculate how much you have put into it. Somehow make sure that if she chooses to turn around and sell it that you get your investment back. But otherwise, get rid of the darn thing. Even the prospect of trying to sell it sounds like a nightmare. Trying to sell it as is, dealing with realtors, and possibly a SIL who feels she is entitled to more because she was locally dealing with showings or realtors, etc. just sounds aweful. Plus, trying to get rent or some form of compensation from her seems like a huge inconvenience. Not to mention the liability aspect of owning a dilapidated home. God forbid it gets condemned and then everyone is up a creek. Give it to her, just do it formally with an attorney who is NOT a family friend. The cost will be worth the peace of mind.
I was going to suggest giving it to her before I saw this post just to save yourself the stress and frustration – but that seemed stupid since it IS A HOUSE and you should get a portion. After reading this though I absolutely say GIVE IT GIVE IT GIVE IT and get yourself out of the whole mess.
Two things I didn’t see mentioned:
1) She may know what a responsilbilty it will be for her to won it alone and may not agree. She may like the fact that she has you guys to lean on.
2) If she does agree, you have the “but we gave you the house” card to use for the rest of your days….(on the other hand if she falls behind with payments or repairs it could come back to “but you gave me the house).
A very frustrating situation any way you look at it!!!
Another vote for GIVE THAT HOUSE AWAY!
It’s not something you have spent money on, it’s not something you were banking on, it’s not something that you’ve invested in that is being taken away from you.
Hopefully it will be beneficial for your marriage, for your bank account, for your peace of mind and possibly … beneficial for your relationship with your SIL.
I can’t see why on earth you’d want to keep the thing. A few bucks (THAT YOU NEVER HAD ANYWAY) is not worth all this anxiety.
Another vote for “give it to her”. You might get a tax benefit from doing so; not sure what the limits are on gifting, but it’s definitely something to look into.
But even if you don’t get any additional benefit from doing so, saying goodbye to an expense that you may never see any return from is a positive move in and of itself. I’d give it to her in a heartbeat, if I were in your shoes!
Give it to her. For sure.
I agree its probably easier to just give it away and not deal with the stress. Have you approached her about selling the house? The two concerns I would have with gifting are 1) the gift tax, like everyone else has said–you could probably figure out a way around that by selling for a very low ($1) price, and 2) be prepared for her to turn around and sell it about ten minutes after you gift it to her.
It seems like she expects to be supported–I am assuming she won’t sell WITH you, because she has a free place to live and is expecting you to fork over $$$ to keep her house fixed up. Once you are no longer in the picture and she has to keep the place up (and pay property taxes) by herself? I bet she sells it immediately and pockets the cash. Its win-win for her, either way.
I still think giving it to her would probably be the best bet though, because keeping it means dealing with her incessant demands.
I’m totally torn here, because I definitely see the appeal of just having the ordeal over with and being able to move on (I am willing to make a lot of sacrifices to prevent future headaches) but I also don’t think I’d be able to just forget about it. There is a part of my brain that is, I think, overly sensitive to what is fair and what isn’t, and I think I would find it very difficult to prevent lingering bad feelings from colouring my relationship with my SIL going forward.
I realize that is petty, and I suppose it is one of those cases where feeling that way is acceptable, but acting on it probably isn’t, so maybe when all is said and done I come down on the side of giving her the house.
interesting situation. i would probably give her the house. but! make sure you make it legal -not just an ‘arrangement’ or an oral contract. have there been discussions about this? she might not even want the house including all the costs on her own if it comes to that. in which case you could sell it, splitting the profits, even if they’re meager. (don’t know if there’s any land involved?)
Give her the house. For all you know, when it’s time to sell the house, it will not pass inspection and need to be razed. Cut your losses and move on.
I think giving the house is an EXCELLENT idea. Truly. Consult counsel, get it in writing, and do it. Given the circumstances, it sounds like a wise and prudent thing to do.
If you can afford whatever tax implication might come of it, give it. I say: the money is not worth the hassle, the anger, the heartache that will be attached to keeping it. It’s much better to wash your hands of it, and to see it as a win-win for both of you. Even if this is what she wants (being annoying with those bills in the hopes that this would happen?), it is sometimes better to let thorns in the side have what they want than to constantly feel the thorn.
Have it appraised, consult an attorney/accountant, and either make her sell or give it to her. I know, definitive, right? But seriously you don’t want to be giving her something that makes her a shitload of money without realizing it – you would be SO ANGRY and it would make family gatherings miserable (or maybe that’s just me).
That said, I love this that Melospiza said: “Sometimes the best thing to do is just donate that $10K you found in unmarked bags to charity.”
GIVE IT. Well, that’s what I was GOING to say before I scrolled along and read Tess’ much better informed response.
Hmph. This situation really sucks.
It’d be great to dump it, since unless it’s in some fiercely awesome location that hasn’t been hit by Teh Economy, then you’re not gonna make money on an old money pit anytime soon.
But evidently there’s that whole gift tax ordeal. Is there any way to opt out of your inheritance?
I suddenly GET the whole notion of arson.
Totally give it — i.e., sell it at a very low price. A few years ago, my parents and I swapped cars, and I had to “sell” my dad my car for $10 and he had to “sell” me his for $10 — that was enough to be able to re-register the titles in the other’s name and avoid the gift issue.
Also, giving her the house is totally the right thing to do for all the reasons everyone has already mentioned, plus the good karma. Do it for sure.
Give……..it! And good riddance to the worry!
Just want to empathize with how completely infuriating this situation is. INFURIATING!
Is there any other money left in your MIL’s estate? Could you possibly take a greater share of any remaining cash in exchange for turning the house over to her? (I’m assuming this isn’t an option, or you’d already have thought of it.)
If not, yes, I’d give her the house (or sell it to her for $10 or whatever to avoid the tax issues.) Just be done with it.
Oh, Swistle, I’m so sorry for the tension this is causing. We have some similar financial issues with my husband’s relatives and I totally get how blood-boilingly awful these sorts of things are to deal with.
Good luck!
I think you should have it appraised and inspected before you do anything. Find out what it is worth, subtract what the necessary repairs will cost, divide by 2, decide how much that amount of money is really worth to you. I would expect you need to know the value of the house for tax purposes or for giving it to the sister purposes or for selling purposes anyway.
Give her the house. If you have it inspected first then 1/2 the repairs become your problem. Sign it over quick!
I believe that I learned the saying, “Does it bless or does it oppress?” from YOU. I think that giving it to her is a great idea IF you can really make it a gift. The whole point of the gift is to unburden yourself.
So keeping that in mind, you must not burden YOURSELF by holding a grudge for her accepting the gift or by becoming bitter once she turns around and sells if for a tidy little profit.
I am so not a tax person, but I do think there would be tax implications if you gave it to her. So could you SELL it to her for, like, a dollar? Obviously if you’d have to pay closing costs la la la la that would be stupid, but what if she just buys Paul’s share for the low, low price of one George Washington? Then you could frame the dollar!
I’m not sure if your sister has a disability or issue that prevents her from working and therefore paying for her own housing, but if not, this is absolute bs. I understand him not wanting to have to fight with her, but also feel like one of the rules of most marriages is that keeping your wife/husband happy is more important than keeping your siblings/parents happy. And you are not being unreasonable. However, it may also be one of those situations where he needs to have sense talked into him by someone other than you. Is there anyone else out there who’s opinion he really values that could possibly talk some sense into him? It just sounds like she is preying on his kindness, and the value he places on how people should treat their families. Should he give away his inheritance? No, imo.
I agree with everyone else, give her the house! (Also you totally won in terms of the bad in-law apt so sorry!) I can imagine the upkeep costs and the potential selling cost of a house like this, not worth it, you’ll never pull a profit anyway. I have to say though based on the other post it seems like the house might just still be in the MIL estate’s name, not in your husband’s and sister’s name. If so it seems like you can just have the estate give the house to your SIL and perhaps in that case gift tax might not be a problem.
I really, really hate having bad financial things having over my head and always want them to be over with as soon as possible. So I’d probably want to give it away. But if giving it away triggers more tax than the repairs might, that would cause me even MORE stress. So I guess in the end I’d do whatever’s likely to cause me personally the least stress, and hopefully that meshes with keeping peace in the marriage.
Wow. Having now read the comments I see most people would give it away. I feel like a bad person now! ;) I have a family friend who once had like a piece of equipment or something, that he didn’t use anymore and it was worth only a couple hundy and a guy told him he (the guy) could make use of it. So my friend gave the equipment, guy barely used it and then SOLD it. This happened in the 80’s and it still burns my friend up. And it was only a couple hundred dollars. The current situation burns you up but MAN, what if you gave it to her? Would that not burn you up too? I don’t know, I still not sold on the giving it away despite the many good arguments.
Swis, you need to give it to her, sure, just to get the fuck out, but you also need to get a lawyer to deal with it, no matter what. You can’t just agree to give it to her without any legal documentation/advice, because yes, it is a tax liability (you have to sell it to her for a price, even if that price is $1 — we went through this with my grandparents). And you HAVE to make it legal/official, otherwise, yes, she continues to come after you for repairs.
Oh dear.
Man, It doesn’t happen that often I’m disagreeing with the majority here. Unless you’ve already put in more money than you have any chance of recouping, I do not think you should give your share of the house away.
I don’t know the exact situation here but I guessing it’s either A) She can’t afford the repairs on her own, so even if you give her the house, she would still probably ask for money. Would Paul be able to say no? It doesn’t seem like it. Or B) She can afford the repairs (and by extension, to pay you rent) but chooses to burden you anyway.
Now, a caveat: If your ONLY goal is to be rid of the house, and you’re not interested in getting your fair inheritance out of it, then by all means, give it to her.
But it seems to me that you’re being bullied out of it. Bullied by the sister who is taking advantage of you, and to a lesser extent, bullied by Paul who won’t stand up to her. You’d probably feel temporary relief in giving her the house, but I think it will be replaced, over time, by resentment towards her, and maybe Paul, at having been bullied.
The only thing that would be fair to everyone is either selling the house outright and taking your half, or determining fair market value, and she buys you out of your half.
It seems like you’d be better off giving it to her – but I don’t know anything about anything…
I didn’t think of the tax stuff, but no way in h*ll would I pay for repairs on a house that I wasn’t going to sell or get rent for.
I think I would be eager to wash my hands of the situation.
I just had another thought! What about if you “sell” her your half of the house and if she doesn’t have the money up front, she can make payments to you for the next however long. Yes, that is what I would do. It could be cheap for her and everything.
Cause you WOULD make money on it since it is paid off! Yeah, no don’t just give it away. Your half of that could probably send one of your kids to college.
Oh I am SO glad to hear about all of the reasons that giving her the house is not a Financial Big Deal.
Because yes, absolutely — if it’s a wash, or roughly a wash — give her the house! And then you can easily refuse further loans, because: House! Gift! You’ll probably save much more in the end. :)
But yeah, some other commenters make good points re: responsibility according to the will, tax implications, etc. Quit-claim may not be enough; I’d check, then give.
Except … Brenna’s totally right … UGH! Some help I am. :(
HOW ABOUT THIS: Radically accept that this isn’t going to go the way you’d like it to and wash your hands of the fucking thing. Don’t worry about justice on this one — focus on it no longer being a headache for you. And for the love of zorg, don’t have imaginary conversations about it with your SIL, Paul, whoever. If tempted, put a rubber band on your wrist and snap it whenever you start. Maybe write a pissed off something or other if it helps purge your understandable pissed-offedness. Just don’t have mental masturbatory fights about it. And keep in mind: family dynamics are weird, and sometimes you just have to accept that someone you love is going to be weird about some family-related thing. This is fraught with weirdness potential. And the distal outcome on this (e.g., a potential profit? a sense of justice?) isn’t going to be worth what you might pay proximally (crappy things that drag you down.) Remember the first rule of cognitive behavior therapy: you might not be able to change the situation, but you can change how you respond to it. Good luck :-)
Wow–so many generous people here! Personally, I don’t think I could just give the house away, even if it’s not worth much. Even if the house itself is run-down, the land alone has to be worth something. Like the other poster said, it just interferes with my sense of fairness to just let her have it. I think that you ought to have the property appraised and then insist that if she wishes to continue to live there, she needs to buy you out. You could even offer to sell her your half for less than it’s worth, since she’s family and you don’t want hard feelings. But to just give it to her outright? Sorry, couldn’t do it. Even if it only yielded a few thousand dollars, you could put it in your children’s college accounts or put it towards the principle on your own mortgage. I think you’ve already been more than generous by allowing her to live there rent free.
It seems sensible to get the house and land assessed first. Then you have a concrete knowledge of what you are giving away. What if it turns out the house is worth only $25,000 but the land is worth more? Then, if you choose to give it to her, I agree with Anonymous to have an attorney spell it out so the SIL understands “as is,” and that your obligation stops. Also like offering the SIL the choice–if you can get Paul to agree to this much–the house and land are worth such and such; would you prefer living in the house and paying minimal rent and half the insurance and other expenses, or having us deed the house over to you and it becoming your full responsibility?
In any case, best wishes on dealing with this!
You can refuse to accept all or part of an inheritance, and it’s not considered a gift from you to the remaining beneficiaries. If it’s not too late for this option, you might want to consider it if giving your share of the house to SIL as a gift is going to incur expenses for you. Check with a tax attorney.
I, too, am going to disagree w/ the gift idea, but that said, I certainly understand the appeal of wanting to give it away.
What I would suggest is moving forward with having the house/property/land appraised (in part because she will know that you are serious about making some decision, whatever that may be), and then offering her the option of both parties selling and splitting the profit OR her buying out your half. C’mon, if she really wants the house, that’s a good deal and if she doesn’t, than you’re both doing the fair thing.
Even if it turned out to be a mere $20-40k, that could be a new vehicle or part of a child’s college education. Plus it gives the SIL an opportunity to act like a grown up, which apparently she needs.
Try that “AllExperts” question posing, I found it really helpful and it gave me a starting point so I didn’t feel like I was flying by the seat of my pants. Good luck!
L.– No, I LOVE your input. I TREASURE it. For one thing, I’m in the mood to be cranky about my sister-in-law (who is not only perfectly fit for work, but has 1.5 jobs because she gets bored if she’s not working). For another thing, I NEED all sides of this issue weighed, because indeed it very well might kill me later if we give the house to her now. I don’t want to let my impulse to “fling the problem away” end up in a WORSE situation LATER, where we’d have no control at all.
My competitive ahole nature bristles at giving it to her, if you do then she WINS.
Sorry, I have too many manipulative relatives who take advantage/have a huge sense of entitlement (like she seems to) and I am just DONE enabling that in any way.
But what I think your saying is that Paul isn’t willing to “lay down the law” with her, in which case, perhaps giving it does make financial sense. BUT STILL.
I’d give it or whatever you have to do to be rid of it, and get the agreement in writing so she can’t renege later. If it’s a money pit and she’s not paying rent, who knows when, if ever you would see any money you put into the house for repairs.
I think you have to find an objective professional estate lawyer to walk you through this. It’s all fraught and high-stakes emotional for you guys, but it happens all the time and I’m sure the pros have advice.
What would you say to a friend who was getting a divorce and laid out a similar scenario about splitting assets with the ex? Because that’s what this reminds me of. He has to divorce himself from this situation, but in a way that can (hopefully) be amicable and not too colored by the emotions. And not have you kicking yourselves ten years down the road for throwing away money that’s rightfully yours.
Been mulling this over some more and I’m thinking I’d probably resent SIL and hubby now and possibly for a long time if we gave away a large sum of money because it’s the easy way out. I’d get an appraisal – what could we reasonably hope to sell the house for if it’s marketed as a fixer upper, as is, with no repairs to be paid for by the sellers? Priced to move quickly. Give SIL first right of refusal.
Subtract out your expected fees, expenses, taxes, etc. Divide the profit in half. If it’s more than a couple thousand dollars, I wouldn’t want to give it away.
To get Paul on board and stop him from thinking of you as money hungry, can you tell him you want this to be grandma’s final gift to her grandchildren? Your profit will go into their college funds. If it’s more than $10K, maybe also use a bit of it for a once in a lifetime family vacation to somewhere your children would enjoy and remember (Grand Canyon, Disneyland, Williamsburg?).
I agree with Cate, this reminds me of a divorce where one party wants to sell and the other (still living in the house) does not. I bet real estate agents and lawyers are used to dealing with this sort of thing all the time.
I am really good at What If-ing, so maybe this concern is unfounded, but here goes. What worries me, if you sign over the house to SIL and she stays put, is that the needed repairs could hang over you like the sword of Damocles, not because of any legal obligation to cover them, but because Paul is a Good Guy and SIL seems like a sponge. IOW, you might wash your hands of the house on paper but she could continue whining about the costs as long as she lives there, if she thinks she can wheedle money out of Paul. So in addition to making sure all legal and accounting Ps and Qs are in order, I would make it very clear to SIL that you two are DONE with the house. Further, I would extract a commitment from Paul that he will not waver on this point in future years. It worries me that they are paying a lawyer but not following his advice.
two could totally play at this game. I say you take a road trip with all of your kids over winter break and crash at the place. With no warning. Make sure your kids have nice, loud games. If she can live there rent-free, so can you. I’m sure it would only take a few days for her to want out of this situation ;)
Even if you don’t do that, isn’t it funny just to think about the expression on her face. Priceless!
My opinion is to give her the house. Sometime having less is more. My parents paid real estate taxes on land he and his brother inherited. Son #1 didn’t pay a DIME and my parents paid it every year,while struggling to raise 6 kids. In the end it was sold for $10000 – not close to paying my parents back for the 40 years they paid taxes. My uncle (son #1) after NOT paying one dime, wanted and my parents gave him 1/2. That was greedy and selfish of my uncle.
Give her the house, let her be responsible for it, and if she were to sell it for the $25K, God Bless her – because 25K today isn’t going to get you another place to live any better.
OH, I got more. My mother inherited a piece of land that once WAS a building lot. However today it was too small. The land taxes and the upkeep to have the land “mowed” were outrageous ~ as well as the FINES if you forgot to mow. Neighbors on either side said they got to use it FREE and it was nice someone else mowed it too, so weren’t interested in buying. Once Mom died, I gave it to the township. I haven’t regretted it, it now costs me nothing.
(grin!) This is a little bizarre to me. I ran across your blog by total accident (clicked on a link, from another link, from another link, of a person I barely know blog!). My husband’s name is Paul. And we did this 15 years ago, only it WAS with an ex-wife. He had a partial interest (not half totally, she got back the principal she paid in on the very low mortgage that was left, and then they were to split the rest, after the youngest child turned 18).
And he held on to that partial interest like a dog with a bone. He felt like that $15 – $20 thou was all he had to show for over a decade of hell of being married to her and he wasn’t gonna let it go. (grin!) So she ‘presented’ bills all the time, for ‘his half’ of repairs, including replacing appliances, which we found out later shouldn’t have even been considered ‘repairs.’ We made payments on half a roof, new carpeting, washing machine fixed, etc. Trying to ‘put it into our budget’ was always an issue, and these two people couldn’t seem to ‘breathe’ in the same room without pissing each other off. So you know that it was constant ‘angst’ every time we got a ‘bill’ from her, worded in such a way designed to tick him off.
Finally, one day I asked him, after listening again to how she was constantly trying to ‘suck us dry’, “what if there was a law that said you had had to stay married to her? How much would you be willing to pay NOT to have to live with her anymore?” (The re-framing the issue comes in handy here.) It didn’t take him long to shift his way of looking at it, and agree to ‘let go’ of the house! In fact, we decided to give it to her ‘totally free and clear’ without any compensation whatsoever. (We were making a payment to her on something else that our attorney wanted us to ask for completion on, in exchange.)
Whether you believe in a ‘higher power’ or that there are any ‘laws’ that affect how we are with one another….or even just quantum physics, and how what you ‘focus on expands in your life’, all the energy pointed at this was only bringing more discord into our lives. So we decided to ‘give it to her’ and let it go (with it in writing of course, that we would have no further obligations towards the house, and by the way, we just signed a quit claim deed and there were no gift tax ramifications.)
Our thought process was that we were ‘giving’ his interest for the benefit of the two kids, and sending ‘blessings’ along with it. And keeping our focus on US and the life we wanted to build with our kids, and as much as we could with their two kids. Now can I tell you that the more we focused on us and our lives and putting our energy towards bringing about the life WE wanted, and we didn’t waste time on what she was doing anymore, and just truly ‘let it go’, well, the more our financial condition improved. We have our own business, and it began growing and getting bigger. We were able to afford things for our enjoyment, vacation and a pool, that benefitted everyone. And she was doing whatever she was doing. Continued….
I would definitely find out the tax implications either way, but I know my cousin sold my sister his car for $1, as that made a huge difference tax-wise, than just giving it to her as a gift. You might be able to do something similar for the house.
My suggestion is to listen to what the attorney has to say. If the title has not been changed, then to my way of thinking there is no reason on earth why you are paying half of anything. This is actually pretty common on probate. The court will say if either of you want the house, pay the sibling their half. If not, sell it and split the proceeds. I can’t imagine giving anything, really. But maybe there is some kind of history here I am unaware of. At any rate – get the dang title straight (which you cannot do without going to court).
Well I’m so late on this, but have been wanting to comment ever since I read this on my phone. Now that I have read the value of the house I would say DO IT. Give it away. Seems like you’ll just nickel and dime yourself with repairs until you’ve put more money in than you’ll ever get out. I was going to mention gift tax – which may have been mentioned above. However, you can give $12,000 tax free to any individual each year and given that’s roughly half of what the house is worth, that shouldn’t really make much of a difference.
I have a hard time agreeing with all the “Give It’s.” There are tax issues, yes. Sure, there is the potential of some kind of payout down the line that you might miss out on. But what about all the repairs you have paid at least half for while she lived their rent free? I’m probably being selfish, but it really REALLY sounds like you are getting the short end of every stick here. Did I miss some part of this story where she bought part of the house with the parents? Maybe you should handle it like a shareholder business and let her buy your husbands share at a very (very) low price?
Laura D.– We haven’t paid anything yet. The concern is that the repairs we WILL pay (starting with roof replacement) if we agree to sister-in-law’s plan will actually exceed the value of our half of the house—so we’d put IN a bunch of money that would be more than we’d get out.
Owning/sharing the house = financial and emotional burden, a continual source of stress.
Giving it away = freedom.
Yeah, if there’s no will, then why does Paul have half the house? Let her have it, make sure you’re not on the title and be free of it/her.
Sell it to her for $100 (or $10, whatever) so that you don’t have to pay a gift tax on it.
It doesn’t hold any value to you, but your sanity and stress level does, so I say get rid of it asap.
If she lives there and wants to do repairs, and you want to own it too – you need to have her pay rent to you.
I’d ‘give’ it to her. It’s worth little (if anyone would even buy it) and you don’t need the stress or LIABILITY. If you do give it to her – you need to be certain you aren’t going to hold a grudge though…because…more stress.
I guess I am dim – I don’t get the “don’t have to pay a gift tax” thing. The gift tax is for the person who is GETTING the gift, not GIVING the gift. Right? RIGHT???
Anon- SADLY NO. I don’t quite get it myself, but the person GIVING the gift has to pay a tax. Maybe the idea is that the person giving it is trying to decrease their income/assets to reduce their taxes, so this keeps people from taking advantage? Dunno. I think taxes are hopelessly tangled and confusing.