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Property inheritance is any sort of property that one gets as the result from the death of the giver. It can include any type of property, business or personal, and can take many forms, from an actual piece of property to personal property, like a car or furniture. Property can include less-tangible assets, such as stocks or bonds. Generally speaking, anything that can be owned can be passed down as property inheritance.
Receiving property as an inheritance can be a difficult process and is not always an advantage. Assuming the deceased left a will, it can take many months before the property is distributed. This process, called probate, happens regardless of the existence of a will, and it can take longer to process if there is no will. In some cases, more money has to be spent to settle probate than the value of any property.
Another disadvantage can be if there is any debt owed on a property. This happens more often with actual physical property, such as a house or car, but can apply if the overall estate of the deceased owes any debt. Property may have to be sold to pay for the debt. Most states require any debts be paid before property inheritance is distributed.
There are also advantages to property inheritance. In addition to acquiring new property, there is the matter of taxes. Depending on the state, there may be no state taxes applied. Many states got rid of what was formerly called the death tax, which essentially penalized the parties involved due to a death. Taxes, if owed, will usually be based on what’s known as the fair market value of the property.
If cash or other goods are received as property inheritance, they can be invested with little or no taxes charged for inheriting them, although that depends a lot on how much was inherited and who inherited the property. This can be a great advantage, but it can be an issue for people who don’t have experience dealing with money. Many people do not know how to budget and save. Sometimes getting an inheritance can cause people to go into debt.
A lawyer will often be involved in the distribution of property inheritance, if only to settle any taxes that may be owed. Property inheritance can be both a blessing and a curse. It works out best if things are prepared and in order beforehand. Writing a will is always the first, and best, step to take to make sure property inheritance is properly distributed.