Is it wrong to want an inheritance early?

[Anonymous]

Your MIL is 80 years old. She may live a long time and may need her money to take care of her needs until her death. If she were to give away her money prematurely, it doesn’t sound like you would be stepping up to support her should the need arise.

[Anonymous]

Hi, I'm following this thread from the UK.

Do you not pay inheritance tax in the US?

In the UK it is not uncommon (not saying it happens all the time) for an elderly, widowed parent to give money to their children as an 'early inheritance'. The law says if the parent lives at least another 7 years from the date the money was given then there is no inheritance tax to pay.

There is a sliding scale of tax. If the parent dies the day after they gave their children the money then 40% inheritance tax is payable by the recipient. If the parent dies a week before the 7-year period is up, then the amount of inheritance tax payable is only a fraction of the 40%.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How big of a house do you want, OP?

Maybe 5,000 square feet with a yard

A family of four doesn’t need 5,000 sq ft. Not even close. Get over yourself and find a house you can afford with your ample earned income.

It would be nice to have a yard for the kids while they are young.

You can’t find a house with a yard on a $400K income?

[Anonymous]

Why don’t you ask her for a loan?

[Anonymous]

If you actually took this money -- and I doubt this post is even for real -- do you have any idea what this would do to your relationship with MIL? We were saving for some much needed home improvements and my parents offered us $30k as an "early inheritance" thinking that would cover it all. It covered less than half but was much appreciated since we were able to get it done faster. But ever since then they are acting cold to my husband because they feel he didn't grovel and thank them profusely enough. They wanted him to write a poem about his eternal love for his inlaws, but the truth is he felt uncomfortable taking the money. She will hold this over your head for the rest of her life.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How big of a house do you want, OP?

Maybe 5,000 square feet with a yard

A family of four doesn’t need 5,000 sq ft. Not even close. Get over yourself and find a house you can afford with your ample earned income.

It would be nice to have a yard for the kids while they are young.

You can’t find a house with a yard on a $400K income?

Not in this area in a good school district with rates the way they are. And we are projecting $400k next year not now.

[Anonymous]

Anonymous wrote:Well, to be fair, what OP is describing w/r/t housing is a real crisis in this country. Very hard to move with mortgage rates rising and home prices still very high. People are staying put and for those who want/need to move, there are very few options.

So for OP it would be nice if someone could help with a downpayment in this crazy market. I get it. But yeah, it's not gonna happen. And that $6m has already dropped. I wouldn't count on it bering there in the future. Your MIL sounds like she's living a good life and she'll need much of that to live it.

There is no rational universe where making $400k, owning a house, and being unable to purchase to a 5000 sq ft house can be considered a real crisis. You are an idiot.

[Anonymous]

Anonymous wrote:Hi, I'm following this thread from the UK.

Do you not pay inheritance tax in the US?

In the UK it is not uncommon (not saying it happens all the time) for an elderly, widowed parent to give money to their children as an 'early inheritance'. The law says if the parent lives at least another 7 years from the date the money was given then there is no inheritance tax to pay.

There is a sliding scale of tax. If the parent dies the day after they gave their children the money then 40% inheritance tax is payable by the recipient. If the parent dies a week before the 7-year period is up, then the amount of inheritance tax payable is only a fraction of the 40%.

We technically do but it only applies to very large estates (say $11 million and up) and even those people usually find a way around it, so while we do have a rule that gifts made within 3 years of death can be taxed as part of the estate it doesn't affect that many people.

Interestingly, nursing home care is one of the areas where we have a form of national health insurance but eligibility is limited to those with few assets so we also have a version of your sliding scale tax for people trying to use govt insurance for nursing home where assets they've given away during the preceding 5 years reduce eligibility.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How big of a house do you want, OP?

Maybe 5,000 square feet with a yard

A family of four doesn’t need 5,000 sq ft. Not even close. Get over yourself and find a house you can afford with your ample earned income.

It would be nice to have a yard for the kids while they are young.

You can’t find a house with a yard on a $400K income?

Not in this area in a good school district with rates the way they are. And we are projecting $400k next year not now.

Well then I guess you either need to move to a different area with a lower cost of living or readjust your expectations. This money that you’re hoping will make your dreams come true isn’t yours and your MIL is under no obligation to give it to you.

[Anonymous]

I have more sympathy for OP than most. The way actual wealthy people take care of their kids and grandkids is to give them help young - college paid for, down payment, private school and college for grandkids. This pays dividends over time, and benefits the kids when they most need it. Inheriting a large sum when you're 50 and kids are in college or past it is not the most efficient use of that money.

OP, your MIL doesn't think like that. You have accept it. But it's ok to be disappointed.

Your MIL may well need the money for end of life care. If you do inherit, pay it forward to your kids instead of sitting on it.

[Anonymous]

I don’t think it’s that bad.

[Anonymous]

Anonymous wrote:I have more sympathy for OP than most. The way actual wealthy people take care of their kids and grandkids is to give them help young - college paid for, down payment, private school and college for grandkids. This pays dividends over time, and benefits the kids when they most need it. Inheriting a large sum when you're 50 and kids are in college or past it is not the most efficient use of that money.

OP, your MIL doesn't think like that. You have accept it. But it's ok to be disappointed.

Your MIL may well need the money for end of life care. If you do inherit, pay it forward to your kids instead of sitting on it.

I agree, but also there is a spectrum. Someone who plans to start a family and is living in a 1BR apartment because they can't put together a downpayment I have a lot more sympathy for than someone who is making $400k and living in a house but wants a new 5,000 ft2 house.

[Anonymous]

There are circumstances where it might be appropriate to suggest and early inheritance, but this is not one of them.

My in-laws were great people and serious savers and over the years accumulated a net worth of several million. It was obvious that they intended to leave everything to their kids in grandkids. Some of their kids, my spouse included, were fine financially, while others weren't -- and not through any fault of their own.

My wealthy SIL basically approached her parents and said "hey, if you're thinking about leaving money to your grandkids, some of them could really use it right now for paying for college, etc., and wouldn't you like to still be around to see how much they can benefit from your help?"

My ILs agreed that this made sense and started doling out gifts to each of the grandkids (and the kids) for the last several years of their lives. It made a huge difference for many of the grandkids.

This is a lot different than what OP is suggesting. My SIL didn't ask for money for her, or even her own kids -- she was thinking of nieces and nephews. And this nonsense about OP's kids "benefiting from a larger home?" C'mon, we all know who OP is really thinking of.

[Anonymous]

Anonymous wrote:I have more sympathy for OP than most. The way actual wealthy people take care of their kids and grandkids is to give them help young - college paid for, down payment, private school and college for grandkids. This pays dividends over time, and benefits the kids when they most need it. Inheriting a large sum when you're 50 and kids are in college or past it is not the most efficient use of that money.

OP, your MIL doesn't think like that. You have accept it. But it's ok to be disappointed.

Your MIL may well need the money for end of life care. If you do inherit, pay it forward to your kids instead of sitting on it.

Well if this is what’s important, OP can keep this in mind and put that money away her future grandchildren.

[Anonymous]

Yes. And you are a terrible person. Wow.