Complete Guide to Selling Inherited Land in Georgia
Inheriting a piece of property can be a blessing or a burden. Many times, land will be sold soon after inheritance. There are a few reasons why an heir may want to sell an inherited property:
- They may not have a use for the property.
- They may live too far away.
- They may not want to maintain the property.
- They may not want to pay property tax every year.
- They may want to sell the property quickly to avoid capital gains tax.
If you have inherited property, you will need to take some legal steps to get title to the property. You will also need to decide what you want to do with the property. If you decide to sell the property, there are a few different options available to you.
In this article, we will discuss the steps involved in selling inherited land in Georgia. We will also discuss the different options available to you when selling your Georgia land.
I inherited property in Georgia, what should I do first?
If you have inherited property, the first step is to get clear title to the land. Clear title means that you are the legal owner of the property and you can sell it or do whatever you want with it.
To get a clear title, you will need to go through the legal process known as probate unless you meet one of the exceptions. Probate is the process of settling a person's estate after they die. This includes paying off any debts that the person owed (such as a mortgage) and distributing the assets to their heirs.
What is probate?
Probate is the legal process of administering the estate of a deceased person. This includes collecting the assets of the estate, paying the debts of the estate, and distributing the assets to the heirs.
In the state of Georgia, probate is handled by the district court in the county where the deceased person resided.
How to avoid probate in Georgia
In Georgia, certain types of assets and situations can bypass the probate process. These exceptions are designed to simplify the transfer of assets upon death, allowing them to pass directly to beneficiaries. These are some common exceptions to probate in Georgia.
Living trusts
Assets held in a revocable living trust do not go through probate. The trustee can manage and distribute the trust's assets according to the terms of the trust agreement without court supervision.
Joint ownership
Joint Tenancy: If the deceased owned property jointly with another person with the right of survivorship, the surviving owner automatically inherits the deceased's share of the property without going through probate.
Tenancy by the Entirety: For married couples, this form of joint ownership also allows the property to pass directly to the surviving spouse.
Small estate affidavit
The affidavit of small estate is a legal document that can be used to collect, transfer, and distribute financial assets of an estate. This affidavit can only be used when there is no will, the estate consists solely of personal property, and when the total value of the decedent's estate is less than $15,000.
Note that a small estate affidavit cannot be used for real estate. For shortened probate proceedings, Georgia has something called no administration necessary.
No administration necessary
The petition for order declaring no administration necessary can be used to shorten the probate process. Filing of this petition is only possible under limited circumstances:
- Deceased person had no will and all of the heirs agree upon the distribution of the estate
- Estate has no outstanding debts (or all creditors have consented to the administration)
- No pending lawsuits involving the estate
It’s possible to use no administration necessary for real estate. This is especially true for land because it’s rare for there to be any debt associated with vacant land.
Probate process - understanding inheritance laws in Georgia
To start the probate process, a petition is filed with the proper court. Next, the executor or personal representative of the decedent's estate will be named. If there is a will, an executor will probably be named in it. If there is not a will, a judge will nominate one.
Once an executor is approved or appointed by the court, the general probate steps are:
- Notifying the heirs
- Notifying any creditors
- Taking inventory of the estate
- Paying off debts and taxes
- Distribution of assets
- Closing the estate
Order of inheritance in Georgia
If someone dies without a will (intestate) then Georgia law determines who has inheritance rights.
How long will Georgia probate take?
The probate process usually takes at least six months to one year, or even longer. Settling any debts alone takes several months. To notify creditors, the personal representative will run an ad in the local newspaper for four concurrent weeks. Once the ad has run, probate creditors have at least three months to come forward to file a claim.
Inheritance tax and capital gains tax in Georgia
Landowners often wonder how inherited property is taxed. Fortunately, there is no inheritance tax in Georgia. There is a federal estate tax, but this is only triggered for inheritance worth several million dollars.
But you may have to pay capital gains tax. A capital gain is when you sell property for more than its tax basis. When you inherit real estate, the property’s tax basis readjusts to fair market value. That means that if you sell a property right away at market value, you would owe little or no capital gains tax.
Short-term capital gains will apply if you sell the property with a gain less than a year after inheriting. Long-term gains will apply if you sell the property after a year or more. The taxable amount would be the difference between the property value at inheritance and the sale price. The federal tax rate on capital gains is 0%, 15%, or 20%, depending on your tax bracket and filing status.
You may have to pay capital gains tax at the state level as well. Long-term capital gains tax rates in Georgia range from 0% to 13.3%, depending on the taxpayer’s income level.
2024 long term capital gains tax rate
Sell inherited property as-is
Once you’ve decided to sell the land, there are three options for selling your Georgia land.
List it with a real estate agent
A real estate agent can help you list your land on the MLS and find potential buyers. They can also negotiate the sale price and handle the paperwork. However, it can take a long time to sell vacant land, and there's no guarantee you'll find a buyer. You may also have to invest in cleaning up the land before it's ready to list for sale.
Sell the land by owner
You can save on real estate agent commissions by selling your land yourself. You can list your land on websites like Zillow and Trulia, or you can put up signs in the area where the land is located. However, you'll be responsible for all the paperwork, dealing with potential buyers, and negotiating contracts. This can be a lot of work, and it may not be worth it if you're not familiar with the real estate market.
Sell to a cash buyer
Cash buyers like our company are willing to buy land quickly and without any contingencies. This can be a good option if you need to sell your land quickly, but you'll likely have to sell it at a discount.
Still, you may just want to move on from the property you've inherited. The convenience of selling hassle-free may be more important than getting the full market price. It's also the fastest way to sell vacant land - the whole process typically takes less than two weeks to sell land. If you like the idea of selling your inherited land quickly, consider requesting a cash offer today.
Frequently asked questions
Does Georgia allow transfer-on-death deeds?
No, Georgia does not allow real estate to be transferred with transfer-on-death deeds.
What is heirs’ property?
Heirs’ property (also known as family land) is a property that has been transferred to multiple people by inheritance, usually without a will. When heirs’ property is created, the heirs all own the property together. Until the heirs go through the appropriate process to have the title or deed to the property changed to reflect their ownership, the property will remain in the name of the person who died.
Please consult your financial advisor, accountant, real estate attorney, or tax specialist. This article is for informational purposes and is not tax or legal advice.
