Inherited Vacant Land in Pennsylvania? The Top 5 Issues Heirs Face

Inheriting land can feel like a gift and a headache at the same time. Many of the parcels we buy in eastern Pennsylvania come from families who received a lot or acreage they never planned for, sometimes in a county they've never visited. If you're in that position, here are the five issues heirs run into most often, and how to handle them.

1. Getting clear title through the estate

You can't sell land until you have the legal authority to do it. In Pennsylvania, that usually means opening an estate with the Register of Wills in the county where the deceased lived. The executor (if there's a will) or administrator (if there isn't) receives letters that authorize them to sell or transfer estate property.

Problems arise when land was never handled after an earlier death. We often see parcels still titled to grandparents or great-grandparents, meaning several estates may need to be addressed before anyone can sell. An estate attorney, and a buyer experienced with these situations, can help sort out the chain of title.

2. Pennsylvania inheritance tax

Pennsylvania is one of the few states with an inheritance tax, and real estate is included. Rates depend on your relationship to the person who passed away:

• 0% for a surviving spouse, and for a parent inheriting from a child aged 21 or younger

• 4.5% for children, grandchildren and other lineal descendants

• 12% for siblings

• 15% for most other heirs

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The tax is generally due nine months after the date of death, and paying within three months earns a 5% discount. Unpaid inheritance tax can become a lien on the property, so it needs to be resolved before or at closing. A recent valuation of the land helps establish the amount owed.

3. Multiple heirs who don't agree

When land passes to several siblings or cousins, each typically owns a share, and all owners usually need to sign to sell. One heir may want to keep the land for hunting, another wants cash, and a third can't be located. These disagreements can stall a sale for years.

In Pennsylvania, any co-owner can ask a court to divide or sell the property through a partition action, but that process is slow and expensive. Often, a firm cash offer gives everyone a concrete number to discuss and makes agreement much easier.

4. Back taxes, dues and carrying costs

While an estate is being settled, the bills keep coming. County, municipal and school taxes still come due. If the land is in a Pocono community in Monroe or Carbon County, association dues continue as well. Many families discover the deceased had already fallen behind, and the parcel may be heading toward a tax sale through the county Tax Claim Bureau.

Act quickly when you learn of delinquent taxes. Contact the Tax Claim Bureau to confirm the balance and any scheduled sale date. A buyer like Acer Land Co. can often pay those balances from the sale proceeds at closing.

5. Not knowing what the land is or what it's worth

Heirs often have only a tax bill and a parcel number. Is there road access? Will it perc for a septic system? Is it in a floodplain, enrolled in Clean and Green, or in an area affected by old coal mining in Schuylkill County? These factors greatly affect value and who will buy it.

Start with the county's online GIS map and assessment records to see the parcel's boundaries, acreage and assessed value. Keep in mind that inherited property generally receives a stepped-up cost basis for federal capital gains purposes, which can reduce the tax on a sale. Ask your accountant how this applies to you.

A simpler path for heirs

If no one in the family wants to keep the land, selling it for cash can settle the estate faster and divide the proceeds cleanly among heirs. Acer Land Co. buys inherited land throughout Delaware, Berks, Schuylkill, Carbon, Monroe, Lehigh and Northampton counties, and we work alongside your estate attorney to keep things smooth. Request a no-obligation offer here or call/text toll-free (877) 589-8773.

This article is for general information only and is not legal or tax advice. Consult a Pennsylvania estate attorney or tax professional about your situation.