My mother left her house to my two brothers. They said I could live there rent free if I paid taxes and alimony. Is this a good idea?


By Quentin Fottrell

‘How are they going to pass the house on to me?’

Dear Quentin,

My father predeceased my mother and she inherited her second home. My mother inherited the house and property to my youngest and oldest brother. None of them are able to take care of the house or property and have given me permission to fix it and live there.

The deeds are still in my parents’ name and my brother has a copy of the will showing his ownership. How are they supposed to pass the house on to me? I don’t want to pay the back taxes and put thousands of dollars into it and then lose title to the property. Thank you for your advice.


Dear daughter/sister,

Your question contains some worrying assumptions. You assume that your brothers will simply stop claiming ownership of you and/or convince your mother to leave the property to you before she dies. It is highly unlikely that they will do so in hindsight. I have tons of Moneyist letters that would confirm this finding.

If you can’t afford to buy a house today and it’s cheaper to live in that house now and/or after your mother dies, then do it. It would help you save for your retirement, and maybe you could build a nest egg for a down payment on a house of your own. But don’t count on your brothers giving you the house.

Best course of action: Have your mother amend her will and/or sign a death certificate making the house yours after her death. That is, if your brothers were also willing to agree, and there is no indication in your letter that they would support such an action.

A transfer on death works the same as a beneficiary on a bank account or insurance policy. One of the most important aspects is that it avoids a probate process – the public accounting of your mother’s assets and liabilities – because the house passes to you after her death.

It would have the added benefit of giving you a “base increase” in capital gains taxes. This means the profit on a future sale of the home would be calculated as the selling price minus the recent appraised/market price of the home – rather than your parents’ original purchase price.

Of course, consult a trust and probate attorney before making any decision, and be open with your mother and brothers about this dilemma. But don’t spend money on taxes and renovations thinking your brothers and/or mother will sign the house over to you. That would be a very big mistake.

In the meantime, I have a question for you: why does your mother only leave this house to your brothers? Will she leave you other assets instead? You could certainly ask that question to your mother. Of course she can do whatever she wants with her estate, but it seems fairer if she includes all three children in her will.

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-Quentin Fottrell


(ENDS) Dow Jones Newswires

11/17/22 1420ET

Copyright (c) 2022 Dow Jones & Company, Inc.


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