ANCHOR: SHOULD YOUR PARENTS GIVE YOU A HOUSE NOW, OR LEAVE IT TO YOU AFTER THEY’RE GONE?

ANCHOR: WGN’S MONEY SAVING EXPERT ILYCE GLINK IS HERE WITH THE ANSWERS TO YOUR MAILBAG QUESTIONS.

GOOD MORNING.

ILYCE: GOOD MORNING.
ANCHOR: MY HUSBAND AND I ARE GETTING DIVORCED. WE’VE WORKED OUT EVERYTHING, EXCEPT I’M WONDERING IF HE SHOULD PURCHASE A LIFE INSURANCE POLICY IN MY NAME? HE IS GIVING ME ALIMONY AND CHILD SUPPORT FOR 8 YEARS.

ILYCE: YOU COULD HAVE YOUR HUSBAND PAY FOR A LIFE INSURANCE OR DISABILITY POLICY, BUT WHY? IF YOU DIE, WILL YOUR HUSBAND TAKE CUSTODY OF YOUR CHILDREN? IF THAT’S THE CASE, YOU MAY NOT NEED INDIVIDUAL LIFE INSURANCE. IF, HOWEVER, YOUR HUSBAND WILL NEVER HAVE CUSTODY OF THE KIDS, OR IF YOU WORK AND PART OF YOUR INCOME GOES TO CARE FOR YOUR OFFSPRING, THEN YOU SHOULD BUY SOME INEXPENSIVE TERM LIFE INSURANCE. CHECK ONLINE FOR WEBSITES TO GO TO FOR TERM LIFE INSURANCE.

ANCHOR: MY PARENTS RECENTLY MOVED TO AN ASSISTED LIVING HOME. WE HAVE TAKEN OVER THEIR HOME AND ARE ABOUT TO SELL OUR FORMER HOME. MY DAD WANTS TO SELL US HIS HOUSE FOR ONE DOLLAR, WHICH HE SAYS WOULD REDUCE HIS ESTATE TAXES. HIS CPA SAYS WE SHOULD RENT THE HOUSE FOR ONE DOLLAR A YEAR AND THEN RECEIVE IT AS PART OF THE ESTATE. WHO IS RIGHT?

ILYCE: IF YOUR PARENTS DIE IN 2010, CURRENT TAX LAW WOULD PERMIT THEM TO PASS DOWN AN UNLIMITED ESTATE WITHOUT PAYING ANY TAXES. YOUR PARENTS COULD PASS DOWN ONE MILLION DOLLARS EACH THIS YEAR. SO, HOW MUCH MONEY DO YOUR PARENTS HAVE? IT’S POSSIBLE THE POINT IS MOOT. ON THE OTHER HAND, IF YOUR PARENTS SELL YOU THE HOUSE FOR ONE DOLLAR, YOU COULD POTENTIALLY FACE A HUGE TAX LIABILITY DOWN THE LINE WHEN YOU SELL. IF YOU INHERIT THE HOUSE, YOU GET IT AT THE CURRENT MARKET VALUE, YOU PROBABLY WILL ELIMINATE ANY TAX LIABILITY. I THINK YOUR CPA IS RIGHT AND YOU SHOULD TAKE HIS ADVICE. IF YOU WANT TO FIND OUT MORE ABOUT ABOUT THESE TAX ISSUES, AND OTHERS, GO TO TAXPLANET.COM OR IRS.GOV.

LETTER 3

ANCHOR: WE ARE FIXING UP OUR FORMER HOUSE TO SELL. THE NEIGHBOR NEXT DOOR WANTS TO BUY IT FOR ONE OF HIS KIDS. HOW DO WE FIND OUT WHAT OUR HOUSE AND THREE ACRES ARE WORTH? WE BELIEVE IT HAS GONE UP IN THE PAST 15 YEARS WE HAVE LIVED THERE.

ILYCE: THE BEST WAY TO FIGURE OUT YOUR HOME IS WORTH IS TO ASK THREE AGENTS TO GIVE YOU A COMPARATIVE MARKETING ANALYSIS. CALL THREE AGENTS WHO DO BUSINESS IN YOUR AREA AND ASK THEM TO COME BY AND DO A CMA. THEY’LL COMPARE THE SALES PRICES OF COMPARABLE HOMES IN YOUR AREA, DEVELOP A MARKETING STRATEGY AND GIVE YOU A SUGGESTED LIST PRICE. THEN, YOU CHOOSE THE AGENT WHO SEEMS TO HAVE THE BEST IDEA OF WHAT’S HAPPENING IN YOUR AREA.

ILYCE: THERE ARE WEBSITES THAT CLAIM TO TELL YOU WHAT YOUR HOME IS WORTH, BUT IF YOU REALLY WANT TO KNOW, GO TO THE BEST SOURCE OF INFORMATION, YOUR NEIGHBORHOOD REAL ESTATE AGENT.