Living on the Florida panhandle often means that your estate includes a condo or beach house. But when elderly parents who own beachfront property die, their adult children may squabble over who will get that prime piece of real estate.
Some may angle to keep it in the family as a shared property for all to enjoy. But that carries its own risks and hassles, as usually one sibling will be stuck with the responsibility of maintaining the property, keeping up with the taxes on it and making needed repairs after hurricanes roll through the area. Others opt to sell it and split the proceeds among the heirs. Just the same, any path has the potential to lead to conflicts among your heirs.
What is the solution? Try these tips:
Communicate your plans
The best way to arrive at a decision about the future and your estate is to discuss the matter openly with your children. If you have four children, take a straw poll to see what each would like to see done with the property. That can help guide your eventual decision.
Consider an LLC
Should you decide to leave the beach house to all of your children, you can put the property into a limited liability corporation (LLC) now. Each adult child will then own an interest in the home. An operating agreement will dictate the process of selling interests in the home, scheduling usage and arranging for maintenance.
Arrange for offsets
If you have two sons, one may have zero interest in inheriting the hassle of a Florida beach house because he lives on the West coast and would never use it. Your other son lives in New Orleans with his family — just a few short hours from the Florida Gulf Coast. He and his wife and kids would love to own beach property for quick getaways. You may want to leave him the property and offset its value in the estate to your other son with stocks, 401k’s or cash.
Do it legally
To avoid trouble and dissension, arrange for your estate planning attorney to draw up the legal documents you need to get your affairs in order and plan for an orderly transition once you are gone.