One of the key reasons to create a trust is to fund it with your assets. Typically, your home and other real estate you own comprise your largest and most valuable assets. (If you own multiple homes outside California, it’s wise to include them in your trust as well in order to avoid separate probates in those states.)
The Benefits Of Putting Your Real Estate in a Trust
Once you designate yourself as a trustee, the advantages of transferring your real estate into trust will become tangible. You’ll be able to avoid both a required property tax reassessment—and, most likely, having to pay transfer taxes—when you transfer your property. You’ll still be able to deduct mortgage interest from your income taxes after you make the transfer, and you won’t need to change the registration of insurance policies you have on the properties.
Additionally, you’ll be able to exclude up to $250,000 of profit from your taxable income when you sell your principal home, even if the trust owns the home; if you co-own your house with someone else, such as your spouse, this exclusion is doubled to $500,000. You’ll also be able to retain homestead rights—which protect your equity interest in your home—after you transfer your property to your trust.
Trusted Attorney Here To Help With Your Transfer
Douglas M. Buchanan Attorney at Law is here to assist you with the real estate trust transfer process. With over two decades of legal experience, I enjoy taking the time to understand your unique circumstances so that I can develop the most successful strategy that will enable you to achieve your goals. Contact me today to learn more.
