Like most property, a vacation home is both an enjoyable asset and a responsibility. When the owner of a cottage or holiday home passes away, their next of kin may not be able or willing to manage the additional property. Fortunately, Florida vacation homeowners who are building an estate plan can give their beneficiaries a few options; they can keep it for personal use, rent it, or sell it. Discussing the rewards and responsibilities involved in each is a good idea when estate planning.
There are many costs that must be considered when inheriting any real estate, whether it is a person’s primary residence, a vacation home, or an investment property. Property taxes, outstanding mortgage balances and maintenance are all primary considerations. Additionally, some people may buy vacation homes together with other family members or friends. This can add complexity in the estate administration process without a clear plan in place.
Those with multiple children may need to work through the preferences of each to land on the best option. For example, some children may be willing to take on a vacation home, while others may be inclined to sell it. Balancing this property with other assets, such as a parent’s primary residence, can help create a more equitable plan.
Another option estate planners might explore would be to sell the property before they pass away, thereby making the money easier to distribute amongst beneficiaries. Alternatively, if the vacation home is a preferred spot, it could be qualified as a personal residence and receive the tax benefits therein. An estate planning lawyer in Florida can help families navigate options and put a clear plan in place for the future.