Asset protection is an issue for many people, especially those who find themselves open to legal actions. If you are like a lot of us your home may be your most valuable asset, and protecting it is obviously going to be very important to you and your family.
One way that you can do this while gaining tax advantages in the process would be through the creation of a qualified personal residence trust.
With a QPRT you fund the vehicle with your home and you name a beneficiary who would assume ownership of it after its term expires. While ownership could be assumed directly by the beneficiaries, you could alternately choose to arrange for the property to be held in trust after the term expires to add still more asset protection.
When you are drawing up the terms of the trust you decide how long you want to remain living in the home as usual rent-free so nothing substantial changes in your life.
The act of funding the trust is considered to be a gift that is taxable. However, the taxable value is reduced by the interest that you retain in it so the longer the term is the lower the taxable value of the gift will be.
If you are interested in employing financial planning strategies that will protect your assets come what may expert guidance is key. To get started, simply take a moment to arrange for an informative consultation with a licensed, experienced, and savvy Central New Jersey estate planning attorney.
- Medicaid Attorneys Explain How a Pre-Paid Funeral Contract Can Help - March 31, 2021
- What Is a QTIP Trust? - March 25, 2021
- How Would You Feel about a Robot Caregiver in the Future? - March 18, 2021