I want my son to inherit my $1.2 million house. Should I leave it to my second husband in my will? He promised to pass it on.


My husband and I signed a prenuptial agreement before we married. This is my second marriage, his first. He has no children. I have one child who was an adult when we married so there was no need for my current husband to adopt him. My husband and I live in a home that I purchased and maintain with my separate property.  

I have been careful to pay for all mortgage and maintenance costs myself to make sure there is no question that this is my separate property. After I die, my trust directs that my husband gets the house — currently worth a net $1.2 million after deducting the outstanding mortgage from its market value — and my child gets the rest of my assets, which are around $1.2 million.  

My husband will also get monthly payments from my pension as a survivor and beneficiary, which will more than cover the monthly mortgage payments. So my husband would, in effect, be paying the mortgage from funds that I provide even after my death. I would like the house to be given back to my son after my husband passes. 

Not a blood relative

He is, after all, my son’s stepfather, but he is not a blood relative. Would the house be considered an inheritance? If my son were to sell the house, would it have a step-up in cost basis just as it would if I had left the house to him directly? Or would my husband leaving the house to my son be akin to a stranger bequeathing the house to him? 

I know I can rewrite my trust to give my husband use of the house while he is alive and then have it pass to my son upon his death, but that forces my husband to live in the house until his death. He may wish to move elsewhere after he retires. What I wish to avoid is his leaving the house to a spouse he marries after my passing. 

If I rewrite my trust to allow my husband to live in the home until his death at which time it passes to my son, what are his options and what happens to the house if he chooses to go live in another state? Can he rent out the house to provide him with an income to pay for housing wherever he goes? I suppose I could stipulate this in my trust.  

I would appreciate any advice you have on this matter. 

Also see: My brother lives in our parents’ home, which we’ll inherit 50/50. I want to keep it in the family for my children. How do I protect my interests?

“Trusts and wills cannot be all things to all people.”

MarketWatch illustration

Dear Wife & Mother,

Alas, you are trying to be too many things to too many people. Set out your goals with your estate planning in order of priority. You will have to make some kind of compromise along the way and, from what you say in your letter, your son is your No. 1 priority from an inheritance viewpoint, even though you wish to make sure your husband has a roof over his head.

You are going to great pains to ensure that your $1.2 million home is not commingled with your marital assets — in the event that you divorced — and yet still plan to leave it to your second husband in your will. Ultimately, you want your son to inherit your entire estate, while ensuring that your second husband lives a financially independent life after you’re gone. 

In order to do that, you have to cut yourself some slack. Situations change, relationships crumble, people marry and those spouses often come with their own power and influence. Your husband and son could fall out. He or a new spouse could fall on hard times and need money for long-term care or medical expenses. That house could become a lucrative source of income.

Trusts and wills cannot be all things to all people. Allow your husband to live in your home for the remainder of his life as a tenant for life, making sure to specify that he must take care of the property taxes and upkeep of the property. But you are asking for trouble by allowing your husband to have his cake and eat it — by allowing him to live in the house and sell it. 

Step-up in basis

So what if you did leave your house to your husband — with the hope/promise that he would keep his word and leave it to your son after he dies? Stepchildren are not ordinarily regarded as legal heirs under the law, unless they are formally adopted, or included in beneficiary designations, trusts, gifts or a last will and testament. Check with a tax lawyer in your state.

It’s complicated. “An heir does not have to be a biological descendant to receive a step-up in basis,” says S. Michelle Jann, director of wealth planning at Goelzer Wealth Management. “The property in question must be included as a part of the decedent’s estate. Qualifying for the step-up in basis doesn’t have anything to do with the relationship of the individual.”

As an aside, there are wrinkles to the step-up rule for married couples, depending on where they live. For example, if you owned the house jointly with your second husband, he would receive a step-up in basis, but likely only on half of the value of the house, Jann says. However, if you lived in a community-property state, he would receive a full step-up in basis. 

This all assumes that you predecease your husband. It’s actually more likely that your husband will die before you. Between 25% and 50% of men outlive women, according to this global study spanning 200 years published in BMJ Open, a peer-reviewed open-access medical journal. Indeed, women tend to outlive men by five to six years, Scientific American reports.

Create an estate plan that is rock solid, one that needs no room for maneuver. 

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com, and follow Quentin Fottrell on X, the platform formerly known as Twitter.

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Previous columns by Quentin Fottrell:

‘She’s obsessed’: My mom moved into my house and refuses to move out. She has paid for repairs and appliances. What should I do?

My parents want to pay off my $200,000 mortgage, and move into my rental. They say I’ll owe my sister $100,000. Is this fair?

‘I hate the 9-to-5 grind’: I want more time with my newborn son. Should I give up my job and dip into my six-figure trust fund?

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