Georgia residents who are making an estate plan may wonder if they can place their home in a qualified personal residence trust. This kind of trust allows a person to transfer their home into a trust and remain a resident on the property. Usually, parents use it to transfer a home to their children. A QPRT may help save on estate taxes.
A vacation home can also be placed in a QPRT. A taxpayer may place a maximum of two homes in such a trust. When the trust period ends, the home goes to the beneficiary or to a trust for the beneficiary. If a person dies before the end of the trust period, the home is considered part of the estate. A person may remain in the home at the end of the trust period with a lease agreement for fair market rent. This can be an additional way for parents to transfer assets to children.
A person can sell the home in a QPRT and move to a new one that will be placed in the trust. However, it is not possible to purchase the home back from the trustee even though the creator of the trust can also be the trustee.
A person who is creating a QPRT as part of their estate plan may want to consult an attorney to ensure that it is done correctly and that all tax laws are observed. This is true for other types of trusts as well. Trusts are complex documents, and it is important to ensure that they are established in such a way that fulfills the wishes of the grantor.