Considering Real Estate When Estate Planning
Real estate can be the key to financial independence for a lifetime. Through collecting rents and investing in your holdings, you may have built a good life for yourself, your family, and your other loved ones.
But managing and maintaining properties is a time-consuming task. You know this. At a certain scale property management becomes a full-time job and incompatible with pursuing another career. If it becomes necessary to hire someone—whether a property manager, office assistant, or on-call repair team—to help with property upkeep and tenant relations, this only adds the work of managing payroll, benefits, and employee schedules.
It is a lifetime of hard work to achieve financial independence through real estate; it’s an honest day’s work to keep things running smoothly. But what happens when you retire, or when you are no longer around to manage the family’s properties? How do you pass down your legacy to provide for your family without saddling them with the responsibilities of managing a real estate portfolio?
Your answer may be a trust.
Putting Properties in Trust
There are many kinds of trust available to you as your plan to disposition of your estate, but they all have a few key features in common. When property—whether real estate holdings, ash, or other assets—is placed into a trust, it ceases to be your property and becomes the property of the trust, managed by a trustee or trustees.
In setting up the trust, a lawyer can help you provide for the care and management of your real estate holdings in perpetuity, without day-to-day involvement from your family or other heirs. The trust could hire employees, collect rents, and order repairs.
Trusts have the additional benefits of shielding you and your heirs from lawsuits. Also, another benefit of a placing a source of income in trust is that payments from a trust fund can be structure to minimize tax liability.
If you are considering how to provide for the care of your real estate portfolio after your retirement or you are otherwise no longer able to manage your properties, contact our office. Our experienced team, who knows the ins and outs of both real estate and estate planning, is here to help with a plan best-suited to your individual needs.