Kudos to Constance Rosenblum of the New York Times for this weekend’s article tackling one of the hard discussions that comes to almost all aging parents and adult children – planning for the future regarding the parents’ residence.
Whether a multi-million dollar penthouse in Manhattan or a suburban home, the residence is likely to be the parents’ biggest asset, and may also be the sole source of cash for future medical expenses, the purchase of a residence in a continuing care facility, or covering the cost of nursing home care. Estate taxes, capital gains taxes, and more can easily devour the value of the home unless proper planning is done.
Having the discussion and understanding the impact of different choices, whether an eventual sale or transfer, is important for parents and children to be able to make informed decisions.
For the best possible outcome, starting this discussion well in advance of the actual time when actions will need to be taken is extremely important. For one thing, Medicaid look-backs are strict, and if the home goes on the market and does not sell in the expected time-frame, the impact could be significant.
The idea of actually leaving the family home, particularly one where the family has lived for decades, is extremely difficult for parents and children, and one of the reasons that things are often left to happenstance. The idea of moving to a new home for an elderly person is often a marker of physical decline and increasing needs, and one not embraced easily or happily.
By discussing the matter of the home ahead of time, when the parent(s) can still be involved in the decision-making process and actively participate in choosing their next residence, some of the sting can be lessened.
If you or your parents are considering the sale of the family home and would like to discuss how to plan for this next phase in their lives, call our office for a free consultation (516-307-1236) or visit our website.