When thinking of your legacy, keeping your assets secure for your family and loved ones is of utmost importance. Putting your house in a trust allows you to more effectively keep your property safe during asset distribution. Here are some reasons to put your house in a trust.
First off, what is a trust? It is a legal means of allowing a trustee to handle and distribute assets owned by the trust on behalf of a beneficiary. A trust gives you more options, such as keeping your wealth safe from taxes or safeguarding until your children are old enough to use it responsibly. Trusts are not just for families with a huge amount of wealth, but rather for anyone of any socioeconomic background. Trusts make dealing with asset distribution after death much easier for the surviving family members. Putting your house in a trust will help preserve the asset and facilitate transfer to your surviving loved ones. Additionally, a trust for the property can save your family from unnecessary court involvement, thereby speeding up the distribution. Trusts also offer more privacy. A will is public, but a trust can be accessible only to those who need to see it.
A house is a valuable asset – much more so than something like the furniture in it or small jewelry. For high value assets a trust is oftern preferable to a will. But what type of trust should you put your house in? There are mainly two types: revocable and irrevocable. Irrevocable, as one can assume, is not able to be changed, so you cannot take the house out of the trust if you change your mind, but this means that you can save money on taxes since it won’t be included in the estate value after you pass. A revocable trust you can change, adding and removing assets whenever you want to. However, this means that the house would be part of your taxable estate at the time of passing, and this trust cannot protect non-homestead property (like investment property) from all creditors.
At Kendrick Law Group, we understand that choosing what kind of trust to put your house in – or even if putting your house in a trust is right for you – is a big decision, and the best way for you to know what fits your situation best is to talk to an attorney. Our attorneys have the experience to help you find exactly the right option for you. Contact us today to schedule a consultation and learn more about trusts.
Cowritten by Layne Cohen, Law Clerk