34

The idea you present is not uncommon, many have tried it before. It would be a great step to find landlords in your area and talk to them about lessons learned. It might cost you a lunch or cup of coffee but it could be the best investment you make. rent it out for a small profit (hopefully make around 3 - 5k a year in profit) Given the median price of ...


23

If you give a gift with stings attached, then it isn't a gift. Thus it would be viewed as trying to get around the tax law. The law regarding this is the Step Transaction Doctrine. But a spouse can also give a gift, and you can give a gift to your child's spouse. Thus a couple can give another couple 4x the limit each year. If the child is in school then ...


22

A lot of people do this. For example, in my area nice townhouses go for about $400K, so if you have $80,000 you can buy one and rent it. Here are the typical numbers: Monthly Payment 30-year loan at 4%: $2,027.73 (Includes Monthly Tax Paid: $416.67) Insurance: $80 per month Maintenance: $50 per month Rental Income: $2,500 per month So you would make $...


15

This is not the answer you were hoping for. I recommend that you stay out of it and let your parents do what they want with their money. They are obviously very good savers and very thrifty with their money. At this point, they likely have more money than they need for the rest of their lives, even if it doesn't grow. It sounds like your parents are ...


14

Your mother's proposal is fraud. Once your mom liquidates her assets by transferring them to you, she'll get on a Section-8 list if her income is less than like $26,000-30,000/year. In some areas, the waiting list is long, and prioritized for families. If she falsely reports that she doesn't own her home, she'll get disqualified for lying. If she transfers ...


14

A 401k plan will ask you to name a beneficiary who will receive the funds if you don't withdraw them all before death. Usually, a primary beneficiary and a secondary beneficiary is requested. If you don't specify a beneficiary, your estate is the beneficiary by default. Note that the name supplied to the 401k plan is who will get the money, and you cannot ...


13

My take is that he can avoid a big tax hit by leaving it as and giving the untouched fund to the heirs. 100% correct. By withdrawing now he'll be subjected to the income tax on the gains. Since his gains are almost the whole value of the account, he'll actually find himself in the highest bracket, not the lowest as Joe suggests. Not only that, but his SS ...


12

This is a reasonable idea and many people have done it. But there are some risks that you need to mitigate. Overleverage. If mandatory payments are more than you can handle, you could lose your property. Think you get laid off during a recession when all your houses are empty. Managing property is a lot of work. A friend does this, but to keep 7 properties ...


10

The only possible downside I would see, assuming they are paying for it, is that the potential exists for it to be counted against you if you need a policy for the benefit of your family. In some cases, some insurers will only cover a certain multiple of your income at their best rates. If you need a new policy, they may count the existing coverage against ...


9

Your estate would still be responsible for paying off the debt. That is your responsibility as a co-signer. Occasionally, people take out life insurance as part of the loan, which (depending on the terms) may kick in upon your death and pay off the loan. If your son has stopped paying the loans, you may want to consider garnisheeing any wages he earns to ...


9

He will receive it just like any other non-spouse beneficiary you could have named. The money can stay in your 401K account if he wants to keep it there. For simplicity, your nephew will want to roll the money over to another qualified account, such as an IRA. The account must be titled in your name, for the benefit of him as beneficiary (aka, "beneficiary ...


8

If there are no dependents, there is no need for life insurance. You mention getting insurance when it is not needed, to protect you against some future risk. If you have a policy and a disease crops up that would normally make you un-insurable, you can keep your insurance for the rest of the term. The cost for this would be very high. You would have to ...


8

There is no benefit in life insurance as such (ie, death insurance.) There is a great deal of value in other types though: total and permanent disability insurance, trauma insurance (a lump sum for a major medical event), and income protection insurance (cover against a temporary but disabling medical condition). If you don't have that, you should get it ...


8

Yes, an estate plan can be very important. Estate planning - typically attempts to eliminate uncertainties over the administration of a probate and maximize the value of the estate by reducing taxes and other expenses. Guardians are often designated for minor children and beneficiaries in incapacity. In general, your "estate" includes all of your assets, ...


8

This is not intended as legal advice, and only covers general knowledge I have on the subject of wills as a result of handling my own finances. Each state of the USA has its own laws on wills and trusts. You can find these online. For example, in Kentucky I found state laws here: http://www.lrc.ky.gov/krs/titles.htm and Title XXXIV is about wills and ...


6

In most countries this should't be an issue you can make such or similar provision. Its best to talk to a lawyer to get the wording right.


6

You should value the unit at: The fair market value of the whole property in 1983 (or whenever 25 years ago was) minus what the eldest sibling paid for the whole property minus the expected value in 1983 of free rent to the parents for the rest of their lives, Then convert from 1983 dollars to 2018 dollars.


5

It goes to the beneficiaries, not necessarily the heirs. Taxation is a bit complicated and depends also on the plan requirements, the new owners' decisions, and the last status of the deceased owner. You should really talk to a tax adviser with the specific details to get a reliable answer that would address your situation. You should also ask about State ...


5

Yes. Dying works great for what you'd like to accomplish. The key point is that you need to specify a beneficiary (or multiple beneficiaries) on the account . When you meet your maker, the beneficiary would have no tax to pay for withdrawals from a Roth IRA. For a regular pre tax IRA, withdrawals are taxed. Either account would have RMDs, required minimum ...


5

Unfortunately, this is an attorney question and not an internet question. A living trust is not only a document, using it also requires that you retitle all the assets in the trust from your father to the trust itself via the trustee. In some states, there are property tax implications. Some states do not treat a home as "owner-occupied" when it is owned ...


4

You need to keep in mind that there's an exemption amount of more than $5M (five million) dollars for estate tax. Unless you used all of it for gifts during your life time, it will more than cover all of your $70K estate, so there's no need in any additional planning. As to Roth vs Traditional IRA - if you want to leave something to your siblings, leave ...


4

I am converting my comment on Jason R's answer to an answer and adding a few other points to consider. One reason for this is that his assertion that a trust can be set up for just a couple of hundred dollars leads me to believe that either he has no children for whom he needs to provide or that he and his spouse went in to the attorney with everything ...


4

Another consideration is that the beneficiary of the life insurance policy may not be the person responsible for paying for the funeral. I'd expect the funeral expenses to come out of the estate of the deceased (if there are any assets there). The other answers regarding the likely timing of the expense vs the life insurance payout are very good as well. ...


4

Make sure you have sufficient insurance. Luckily, my wife and I had insurance on our mortgage, and term life insurance on both of us. Statistically speaking, insurance is a poor investment. However, when my wife was killed 263 days after our wedding, I was very happy to have it. Note that it took almost five months to pay out, though this was partly due to a ...


4

1 - in most cases, the difference between filing joint or married filing single is close to zero. When there is a difference you're better off filing joint. 2 - The way the W4 works is based on how many allowances you claim. Unfortunately, even in the day of computers, it does not allow for a simple "well my deduction are $xxx, don't tax that money." Each ...


4

You're talking about gifting your home to your son. That will actually mean that you need to pay taxes, unless the value of your home is below the exemption for the gift tax. You will, probably, use the lifetime exemption, but it will come out of the exemption for your estate. Once your son is the owner, he'll be liable for the property taxes. If your wife ...


4

This is a common and good game-plan to learn valuable life skills and build a supplemental income. Eventually, it could become a primary income, and your strategic risk is overall relatively low. If you are diligent and patient, you are likely to succeed, but at a rate that is so slow that the primary beneficiaries of your efforts may be your children and ...


4

As a first step I would talk to a German real estate agent (Immobilienmakler), who will be able to give you an idea of the costs, fees, insurance needed to purchase a property, and who would be able to address your other common concerns. If you are clear in your initial phone call about what your resources, desires and intentions are; you will probably be ...


3

This is the Section 8 information page for elderly persons. It includes low-income housing, and other ways of lowering costs for elderly people, with links to options that vary based on location. Assets Let's say that your mother were to transfer her home to you, by sale or otherwise. Does your mother have other assets e.g. mutual funds? This could ...


3

Simple answer: Life insurance proceeds are income tax free in most cases, but not always estate tax free. If the life insurance policy are included in your estate and your estate is over the exemption limit for the year that you expire, then taxes will be taken out of your estate. If your estate is not over the exemption limit, no need don't worry. You ...


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