Should You Own Your Home in Your Trust?

Homes are illiquid assets that produce no income and come with ongoing costs for upkeep. Those issues can cause some snags with your trust.

A hand holds a miniature model of a home.
(Image credit: Getty Images)

A typical estate at death will include a personal residence. Many large estates also include a vacation home, farm or family retreat. Leaving real property in trust is common. Estate plans that include a revocable trust will fund the trust by a pour-over Last Will orchestrated by the personal representative.

Sometimes the settlor, the person establishing a trust, will title their home to the revocable trust, which then becomes irrevocable at death. Other times, an estate planner will recommend a Qualified Personal Residence Trust, which is irrevocable, to gift a valuable home to a trust for their children. Through this method, the house is passed over a term of years while the original owner continues to live there so that the gift passes with little or no gift or estate tax.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Timothy Barrett, Trust Counsel
Senior Vice President, Argent Trust Company

Timothy Barrett is a Senior Vice President and Trust Counsel with Argent Trust Company. Timothy is a graduate of the Louis D. Brandeis School of Law, past Officer of the Metro Louisville Estate Planning Council and the Estate Planning Council of Southern Indiana, Member of the Louisville, Kentucky, and Indiana Bar Associations, and the University of Kentucky Estate Planning Institute Committee.