Help With Next Step When House Is Too Big
Washington Times (12/01/00) Vol. 104, No. 47 p.F3; Carr, M. Anthony

Many homeowners approaching retirement may find that they are ready to give up the maintenance, higher utility bills, and extra space common to a large single-family residence. A move to smaller quarters could be difficult, though, due to the sentimental attachment and the complicated logistics associated with making such a change late in life. Those owners who have already retired should understand that living in an older home can begin to eat into their fixed income as the property continues to age and requires more and more repairs. The house will need to be sold in time, and the sooner the better. Low maintenance and affordability are better options for many than living in a home that is too large. The AARP has produced a list of questions that seniors should consider before planning a move to scaled-down living. Retirees relocating to a new residence should consider the style of living they would prefer. This includes the state of maintenance, level of comfort, and amenities. They might also consider location, in terms of neighborhoods and proximity to the grocery store, doctor's office, and relatives. Retirees planning to move to a new residence should also consider safety criteria, including the presence of smoke detectors, fire extinguishers, and secure doors. If retirees are considering moving in with their children, they should factor the possible changes in family dynamics. One potential issue is whether or not the home is suitable for an older adult to reside. Retirees might also consider the $500,000 exclusion available to married homeowners. Or $250,000 for singles, when selling a principal residence. Should a spouse pass away in the same year as the home is sold, the living mate is still entitled to the $500,000 exclusion. After that year, the widow or widower can only claim the $250,000 tax shelter and must pay capitals gains on the remaining amount of the transaction.

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