Willing Your Home

Physician's Money Digest, January31 2004, Volume 11, Issue 2

With the boom in real estate prices,your home may represent an ever largershare of your estate. There are severalgood reasons to will the house to yourchildren instead of your spouse, includinga stepped-up cost basis when the kidsinherit, which can reduce or even eliminateany capital gains taxes if they decideto sell. If the house is worth lessthan $1.5 million, there shouldn't be anyestate tax issues, either. Also, by willingthe house to the children and cash andsecurities to your spouse, you provideyour spouse with the liquid assets thatmay be needed for living expenses. Yourspouse may also be able to continue livingin the house by working out a rentalagreement with your children.