Should Mom just give us the house instead of selling it?
Answered by Chris Deutsch, Founder & Editor
Licensed Minnesota Realtor #20382264 ·
The short answer
Usually not — and the reasons are expensive. A gifted house carries Mom's original cost basis. Sell it later and the capital gains bill can be enormous. An inherited house, by contrast, generally arrives with its value reset as of the date of death, often erasing decades of taxable gain. The same house, transferred two different ways, can produce wildly different outcomes.
On stage The 60-second answer
Captions on · Transcript below
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The longer answer
The Medicaid angle points the same direction. Gifts made within five years of applying for help with care costs can trigger a penalty period — what looked like simplifying creates the exact problem it was meant to avoid.
There are situations where a transfer is right, and that's elder-law attorney territory with a CPA alongside. (I'm neither, and this isn't tax or legal advice.) If an outright sale belongs on the table too, I'll tell you honestly what the house would bring. Call anytime.
The next department over
What people in this spot usually ask next.
- Senior transitionsMy siblings and I can't agree on what to do about Mom's house. How do households get through this?Read the answer
- Senior transitionsWhat happens to the house while Dad is in assisted living and it's sitting empty?Read the answer
- Senior transitionsMy parents have a reverse mortgage. What happens when they sell?Read the answer
- Senior transitionsDoes selling the house affect Medicaid eligibility for a parent in Minnesota?Read the answer
- Inheritance & probateWill we owe capital gains tax when we sell our parents' house?Read the answer
- Inheritance & probateWe live out of state. Can we sell Mom's Minneapolis house without flying back?Read the answer
From the editor's desk
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