DW and I are considering helping dad (76) move into a condo closer to us. He's been a life-long apartment renter, would have to wipe out most of his cash for a down payment on this place. We can afford to pay cash for the unit, and he's fine renting back from us. No other children, entire estate would be left to me. Looking for some advice primarily on who should own the unit. For simplicity it would seem us being the owners and him paying us rent. We could also loan him the full amount of the purchase price and he would own the unit outright. I assume we could also purchase this in a trust or an LLC?
Us as direct owners seems the easiest for when he's no longer in the condo, I'm just wondering if we're missing anything from a legal or tax lens.
Unit is approx $250k, $5k/y taxes, $300/m maint.
We're not looking to make money on this, he'd pay us what it's costing us to "borrow" the $250k from our assets along with the taxes and maintenance fees. If we go the route of us being the owners, I assume we should be properly reporting the rent income and offsetting it with our costs.
The other "simple" option is to loan him the cash, have him purchase in a trust with me as the beneficiary, and then just let the rent payments accrue in his checking account which I'm also a co-owner of?
Then there's always the unknown needs of future LTC, and if this is his asset without a fully registered mortgage to us, a nursing home would be able to put a lien on it?
This is in NJ if it matters.
Us as direct owners seems the easiest for when he's no longer in the condo, I'm just wondering if we're missing anything from a legal or tax lens.
Unit is approx $250k, $5k/y taxes, $300/m maint.
We're not looking to make money on this, he'd pay us what it's costing us to "borrow" the $250k from our assets along with the taxes and maintenance fees. If we go the route of us being the owners, I assume we should be properly reporting the rent income and offsetting it with our costs.
The other "simple" option is to loan him the cash, have him purchase in a trust with me as the beneficiary, and then just let the rent payments accrue in his checking account which I'm also a co-owner of?
Then there's always the unknown needs of future LTC, and if this is his asset without a fully registered mortgage to us, a nursing home would be able to put a lien on it?
This is in NJ if it matters.
Statistics: Posted by SteveInNJ — Tue Oct 22, 2024 9:37 pm — Replies 0 — Views 118