Salt Lake City, UT asked in Elder Law for Utah

Q: Elderly Law Question.

Elderly Law Question. Has a home (Paid off) income from retirement and social security and insurance through retirement (not Medicaid or Medicare).

If were to sell the house today, is that considered income? and would they have to pay taxes on that money?

They want to take the money and split it three ways, themselves and too each of the 2 children. Would the kids need to pay taxes on what they are given?

In addition, Annuities are these lifetime payments. Or is there a time the payments stop? Due to Age or any other reason?

Not minding research are you willing and or able to tell me for elderly is there anything else that may be super important that we should think about? (Besides, will, trust, and power of attorney)

Related Topics:
1 Lawyer Answer
Wesley Winsor
Wesley Winsor
PREMIUM
Answered
  • Elder Law Lawyer
  • Saint George, UT
  • Licensed in Utah

A: If the elder sells the home, then taxes will be calculated by determining the gain on the sale of the home. In simple terms, the difference between the purchase price and improvements and the sales price. The difference would be considered a long-term capital gain. The good news is, is that if the elder lived in and owned the home for 2 out of the last 5 years, then the gain on the sale of the home is exempt from taxation as long as the gain is 250k or less.

If she gifts that money to you, there is no tax impact on gifts to the recipients of the gifts. They are not taxable. There is a gift tax that starts nearly 11 million to the grantor of the gifts. I don't know the size of the elder's estate, but I would talk with your accountant as you may have to file an extra form if the gifts are made all at once so as to take advantage of the lifetime gift tax exemption amount.

Annuities come in all types of flavors. Some make payouts for the life of the person with a balloon death benefit payout, others (most common) usually end at the death of the person. You should talk about this with your financial advisor.

You didn't mention a health care directive, I consider those as critical as well. It a medical power of attorney with instructions on how they would like to be treated. Other instruments such as assignments and deeds are used to fund trusts. I am not quite sure how much into the nuts and bolts you want to go.

I hope this helps.

Wes

1 user found this answer helpful

Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.

The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.

Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.