![]() Your attorney, tax and financial advisor can work with you in building flexibility and options using your high-value real estate, whether in a QPRT or other advanced planning vehicles. However, it's important to understand your full financial picture and that of your beneficiaries. Is a QPRT Flexible?Ī QPRT can be designed to provide a degree of flexibility. Your tax advisor can work with you to make this determination. Depending on the planning structure of the QPRT and whether any prior gifts were made, you may not have to pay taxes at the time of the transfer. The longer you remain, the smaller the value of the gift. However, the value is reduced based on the fixed period you choose to remain in the home. The transfer of ownership via a QPRT is a taxable gift at the time it is made. Will You Incur Taxes at the Time of the Transfer? This will further diminish your taxable estate value. You may also remain in the home at the end of the period by renting it back, but you must pay fair market rent. At the end of the fixed period, the ownership then passes to your designated beneficiaries. You can transfer your property to a QPRT, retaining only the right to live in the home for a fixed period of time. ![]() If you are single and your taxable estate exceeds the federal inflation-adjusted gift and current estate tax exemption amount ($12.06 million per individual federally and $5.49 million in Hawaii), you may be subject to an estate tax (at rates of up to 40 percent federally and 20% in Hawaii). It can save wealthy homeowners hundreds of thousands of dollars in estate taxes when they pass away. What Is a QPRT?Ī Qualified Personal Residence Trust is designed to reduce the amount of gift and estate tax that is incurred when transferring ownership of a home to an heir or beneficiary. One way to do this is through a specialized trust called the Qualified Personal Residence Trust (QPRT). ![]() ![]() Therefore, preserving assets and minimizing tax burden is a common concern among wealthy homeowners. Protecting that investment is a top priority, especially if you’d like the property to remain a long-term investment for many generations to come. Residential property is often a homeowner's most valuable asset. ![]()
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