farmland ownership

[blissn]

My husband and his brother each inherited an undivided half interest in 100 acres of farmland in Whiteside County, IL. They currently cash rent this property and the only expenses they incur are property taxes. Now his brother wants our and we need to know if he can force us to sell the property. What are our options? We don't want a capital gain at this time and enjoy the cash rent we are receiving. Thanks for your help.

 

[Tracey]

Either owner can force the sale of jointly held property by petitioning the court for a partition by sale. The court will declare what a "reasonable" sale price is & order the sale. The owners end up paying legal fees, court fees, & the sales commission. A court ordered sale is more expensive than a voluntary sale.

Why would you experience a capital gain? Have you owned the property for a long time? When they inherited the land, the new owners got a step up in basis to the lands fair market value at that time. If you really need to spread out the gains, you could consider an owner-financed sale. This spreads out the gains over the life of the mortgage. If you choose this option, you'll need to spend $$ on an experienced real estate attorney.

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This is not legal advice and you are not my client. Double check everything with your own attorney and your state's laws.