Estate Planning When Living With a Parent

It is not at all uncommon for a parent to have an adult child live with him or her. This typically occurs for one of two reasons. Either the child is acting as a caregiver for the parent, or the child is unable or unwilling to begin living on his own. No matter the reason that the adult child is living with the parent, this often causes problems with other children and beneficiaries when the parent passes away. A recent article discusses estate planning issues you may face if you or a sibling lives with your parents.

The first issue is, what happens when the parent dies? The other surviving children and grandchildren may want the individual to move out immediately so the property can be sold and the proceeds divided between the heirs. This can often cause tension between family members. If the family member living in the home wants   to remain in the home, he or she will need to buy out the other siblings. If the child does not move out of the house immediately after the parent dies, the other heirs may require that child to pay rent.

If you have an adult child living in your residence, and you would like him or her to remain in your residence after your death, consider transferring the residence to him or her, then making comparable gifts or bequests for your other children. Be sure to make a clear plan for the disposition of your home, and share it with your children.

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