Inheriting a house can be emotionally overwhelming and financially challenging, especially if you’re unsure what comes next. If you’ve recently come into an inherited property in Burlington, North Carolina, there are several important steps to take before you make any decisions.
In this blog, we’ll explore everything you need to know if you’re a new property owner through inheritance. Whether you plan to keep the house, turn it into passive income, or list it for sale, this guide will help you make informed choices that honor your loved one’s legacy and protect your financial situation.
Understand the Inheritance Process
Inheriting property in Burlington, NC, can be both a blessing and a challenge. The first step is understanding the inheritance process, whether the inherited property comes from a family member or a distant relative. You’ll need a copy of the death certificate, and the probate court may need to validate the will and assign ownership. The property cannot be sold or transferred during the probate process until the legal paperwork is complete. Consider working with professionals for a complete guide to managing this process.
Evaluate the Property and Estate
Once ownership is legally established, evaluate the house and its condition. You may need to make necessary repairs or update the home before renting or selling it. Check for any remaining mortgage or debt attached to the estate, and consider consulting an insurance company to review or update the insurance policy. Understand whether the inherited house was the primary residence of the previous owner or an investment property, as this affects your options.
Know Your Tax Responsibilities
One of the biggest surprises you may face is taxes. While federal estate taxes may apply to large estates, you may deal with capital gains taxes, property taxes, and estate tax in North Carolina. If you choose to sell the property, you’ll be subject to capital gains based on the stepped-up basis, the fair market value at the time of the decedent’s death, not what they originally paid.
Decide Whether to Sell, Rent, or Move In
What should you do with the inherited home? If you don’t plan to live in it, you have options.
Here's what you can do:
Sell the property and use the proceeds for other assets or investments.
Rent it out and earn passive income as a long-term strategy.
Keep it as a second home or vacation space.
Consult a trusted real estate agent to help determine the home’s current value and potential sale price, whichever route you choose.
Let RB Legacy Property Management Help You Handle Your Inheritance
At RB Legacy, we understand that dealing with a property after a previous owner's death can be emotionally and financially draining. That’s why we offer expert guidance aligned to your situation, from preparing a home for rent or sale to helping you assess your financial situation and connect with trusted partners like attorneys, CPAs, and insurance companies.
Whether you’ve recently inherited a house or are in the middle of the probate process, our team is here to simplify the journey. Contact us today and let us help you make the most of your inherited property and turn it into a successful investment.
Frequently Asked Questions
1. Do I have to go through probate if I inherit a house in Burlington?
Yes, most inherited properties must go through probate court, unless the estate was set up with a trust or joint ownership that bypasses the process.
2. Will I pay capital gains taxes if I sell the inherited property?
You may owe capital gains taxes, but these are based on the stepped-up basis, the fair market value at the time of death, not the original purchase price.
3. Should I insure the home immediately after inheriting it?
Yes. You should contact an insurance company immediately to ensure the inherited house is protected, even if it's unoccupied.
4. Can I rent out an inherited home?
Absolutely. Renting the home can generate passive income, but be sure it’s in good condition and legally compliant before listing it.
5. What is the role of the executor when I inherit property?
The executor is the person appointed to administer the deceased's estate and ensure that all assets, including any inherited property, are distributed according to the will (or state law if there's no will). Suppose you’ve inherited a house in Burlington, NC. In that case, the executor is responsible for initiating the probate process, obtaining the death certificate, settling any debts or taxes, and transferring legal ownership of the property to you. It's essential to work closely with the executor to understand the timeline and any obligations related to the estate.