Wow about the house situation.
If it were me, I'd have a tough time with a moocher taking advantage of you and your sister regardless of any 'advantage' of someone occupying the residence. Like you said, you paid rent and now you have a sense of value for the cost of things. This nephew doesn't. Nor does he have any respect for his mother, let alone you, to take advantage of this situation. At the very least, I would have had him responsible for the rent from day one just so he could see, on paper, the value of 'free' rent.
But that's just me.
I would never consider a loan to either sister or nephew based on their past financial management for the home or it's rent value. You will only be disappointed or worse, likely to cause a rift in the family. And who needs that, especially over money?
I'd get out of the house as an asset as soon as possible. Either have sis buy you out or sell it and split the equity. What you do with the profits would be another topic, but I'm sure there are ways to shelter it somehow.
As far as taking SS, that'll depend on how you liquidate your share of the house you inherited and how soon that can happen.
Prepare for some hard feelings from your sis and nephew. Both are used to this arrangement and anything other than you just gifting your interest is going to be seen in their eyes as a negative. You might approach sis by asking her how she would like to see this come out. Just let her know you need to convert this asset to something more liquid and what her thoughts are on how to do this. Very non-adversarial.
I have asked, repeatedly, for input from her and nephew on what we can do to make everyone happy. Not looking to remove him under the circumstances, but I can't seem to get any answers from her. I get responses like "Like I told you before, I'll check when I have time..." or every one of my questions is answered with another question.
This is the list of questions I sent and got some answers to:
As I told you the other day, I will give you more information when I have more time. Here is some. The estate was closed in 2012 before the house was moved into the llc. Not trying to be evasive, just trying to catch up.
On June 30, 2020, at 1:38 PM, I wrote:
>I was thinking the other day, that we haven’t heard any updates regarding the estate for several years now and I was wondering how things were going. I have some questions and I will try to be specific. I feel somewhat left in the dark about being involved in the affairs of the estate, but that is my fault for not asking. I hope all is OK.
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>1) Is J(nephew) still renting the house? He is living there, not paying rent at the moment.
>2) How much rent does he pay and does he pay any of the utilities in addition to that? He lost his job just before the shutdown so is not paying rent right now. I have been paying the utilities myself since he moved in since any renter would pay their own utilities. He paid rent sporadically before that he lost his job.
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>3) How much are the bills for the house that the renter does not pay? I will give you those numbers later. I have used any rent income to cover taxes and insurance and repairs.
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>4) Water and sewer? Later, not an expense of the llc
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>5) Electric? Later, not an expense of the llc
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>6) Garbage? Later, not an expense of the llc.
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>7) Taxes? 3635/year
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>8) Homeowners Insurance? Later
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>9) Is there a deposit being made into the estate account to meet annual tax and insurance payments? Rent income goes into the llc checking account that I opened in my name or I move money into there to pay expenses.
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>10) Is there any after expenses profit going to repay construction costs to you? No
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>11) If so, how much of the money have you made back? I am assuming that is one reason you are collecting rent, in addition to having a wonderful tenant. will give you a full accounting later.
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>12) I remember you were saying you may have to take out a loan in the name of the LLC to finish paying for the repairs that needed to be done. I haven’t heard anything about this since then. Is there currently a lien on the house? No loan, no lien. I paid for what's done, still some things to be done.
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>13) I understand that since (brother) did not sign the LLC papers, there is no LLC, and the last I heard the only option you had was to open a checking account in your name to use for the estate income and expenses. Do you have a brief summary of the monthly income and expenses of that account? I do not need detailed. Later. The llc is a legal entity and the house is in it. (Brother) signed the llc legal papers allowing it to be formed. He didn't sign the member agreement between the three of us allowing me to do some things on behalf of the llc. I opened a checking account in my name to use only for llc business. Rent money goes in there and llc expenses are paid out of there. I have paid some out of my own account, but have kept track well. With no agreement the pud (Electric) is still in moms name.no big deal. I have been able to have most repairs done without the agreement.
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>14) Is the estate at risk if you get sued? We really need to move forward with getting the estate legalized. No, estate is closed.
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>15) My portion of the estate will have $12,000 deducted for Mom’s Honda. Estate is closed. I used any estate funds on the house, and replaced the money that was stolen from my former friend/contractor.
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>16) In addition, there was the expense of (sister’s significant other) and the boys renting the truck, delivering the goods, hotel, food, fuel and then 3 airline tickets home that will come out of my part. What did that amount to? I don’t remember hearing about that. Vacation trip, got new shirts, estate is closed.
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>17) I don’t think I got any details in the beginning, so correct me if I am wrong. The estate started out with these funds:
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>Brother’s bonds: $26,554, plus a life insurance policy, $5,000; Sister’s bonds, $9,000, plus a Life Insurance policy valued at somewhere between $19,000 and $24,000 (I never heard exactly what that was). Also, there was roughly $3,000 in Mom’s checking and savings. That should be around $62,554 - $67,554. Sister said the $9,000 in bonds had gone mostly to the funeral expenses, etc. right off the top in February 2010, so that leaves roughly $53,000 left for repairs to the house. Contractor did approximately ~$20,000 in repairs and walked away with ~$30,000, leaving the estate funds to $0. How much additional money did you pay out of your own pocket to finish the repairs to the house? I can give a full accounting later.
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>18) Are all the remodeling/repairs finished on the house? A couple of items to do.
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>19) Do you have any idea what current market value of the house is from what you are paying taxes on? I am going to guess it is worth twice what it was 10 years ago. It has increased A lot in value. That area has gone up greatly. Current value per assessor is $387,500.
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>If I have left anything out, please let me know. I just feel I should now some of these things. Maybe I do and have forgotten.
I am behind on my accounting and will send you the numbers as soon as I am able.
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>Thanks