Tips from Local Portsmouth NH REALTORS® Ann Cummings & Jim Lee
For many families in Portsmouth, NH and along the New Hampshire Seacoast and Southern Maine, the family home is more than just an asset—it’s a place full of memories, history, and emotional ties. But when it comes to estate planning, passing down your home can also bring unexpected legal, tax, and personal challenges.
As experienced local REALTORS® with RE/MAX Shoreline, we’ve helped many families navigate the complexities of transitioning property between generations. Whether your goal is to sell, gift, or pass down your home, understanding your options—and planning ahead—can save your family heartache and costly surprises.
Here are three smart ways to transfer your home to your children or heirs, and what to keep in mind:
1. Sell the Home to a Child or Heir
If you’re considering downsizing or using the equity in your home for retirement or other plans, selling your home to a family member might be a practical option.
Benefits:
- Removes the property from your taxable estate.
- Sets a new cost basis, helping reduce capital gains taxes for your heir when they eventually sell.
⚠️ Caution: Selling below market value may trigger federal gift tax rules. It’s important to use the fair market value to avoid penalties.
2. Gift the Home During Your Lifetime
Giving your home as a living gift can feel generous—but it could have significant tax consequences.
Key points to consider:
- This counts toward your lifetime gift tax exemption, which currently sits at $13.99M (2025) but is expected to drop by half in 2026.
- Your child inherits your original purchase price as their cost basis—potentially exposing them to large capital gains taxes if they sell.
If you’re thinking about gifting a home in the Portsmouth NH or Seacoast area, consult with a tax advisor first.
3. Pass It Down After Your Lifetime
There are a few ways to leave your home to loved ones that avoid or simplify probate:
- Will: A standard option, but it must go through probate, which can delay transfer of ownership.
- Transfer-on-Death Deed: Available in some states (check local laws), this lets the home pass directly to your heirs without probate.
- Trust (QPRT): Placing your home into a Qualified Personal Residence Trust can avoid probate and provide better control over conditions and timing of the transfer.
🛠️ Pro Tip: Consider setting aside money in a trust to help your heirs cover costs like property taxes, repairs, and insurance—especially if you plan to leave the home to more than one heir.
Don’t Forget the Property Tax Reassessment
No matter how you transfer your home, the event may trigger a reassessment of its value for property tax purposes. That’s another reason why early planning with a financial advisor or estate attorney is essential.
Start the Conversation Early
In our experience working with families across Portsmouth NH and Southern Maine, the most successful home transitions happen when everyone is informed and included in the planning. Your children may cherish the memories tied to the home, but that doesn’t always mean they want to—or can afford to—live there.
Whether you’re thinking about passing down a waterfront home in Rye, a family cottage in Kittery, or a historic gem right in downtown Portsmouth, talking openly with your heirs helps you align your legacy with their future.
Need Local Guidance?
As Portsmouth NH real estate experts, we’re here to help you evaluate your home’s market value, connect with trusted legal and financial advisors, and make thoughtful decisions about your home’s future.
Let’s talk about your options—without pressure, just honest guidance.
📞 Ann Cummings & Jim Lee, REALTORS®
🏡 RE/MAX Shoreline | Local Experts on the New Hampshire Seacoast and Southern Maine
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