Buying a Property in the name of a Trust

[krazeenyc]

Anyone have any experience with buying real estate, not in your own name or corporate name but in a trust.

I haven't created the trust yet but was wondering if it makes sense to do so. IF anyone has any experience and would be willing to share it would be much appreciated.

 

 

[jschembs]

My only experience is transferring a property my sister and I inherited into an LLC I created to rent the property on a short-term basis. I believe the process would be similar:

 

1. Create the entity, secure the tax ID (unless it's a revocable trust, in which case I believe the trust uses your SSN);

2. Proceed with the property acquisition

3. Make sure all required signatories execute all of the documentation

 

However, this certainly is an instance where an hour or two of legal advice from a trust & estate attorney is worthwhile.

[jschembs]

Also, what kind of trust would this be? If it involves multiple beneficiaries and/or trustees, you'll certainly want to be as explicit as you feel is warranted to mitigate arguments down the road.

[krazeenyc]

Also, what kind of trust would this be? If it involves multiple beneficiaries and/or trustees, you'll certainly want to be as explicit as you feel is warranted to mitigate arguments down the road.

 

There is no definitive reason I want to create the trust but I have some vague thoughts. I have very young children.  Rental real estate can be extremely tax efficient - I was thinking it would be a good way for my kids to build wealth (in addition to the equities they hold).  I have some other thoughts as well but nothing definitive.

 

By the way thanks for helping out a 49ers fan! Looking forward to that game got our butts smoked the last 2 times we played up there.

[Granitepost]

You could probably just have title to the property put in your name in trust for (name of beneficiary kids).  There may be differences in Canada and the US, but I believe the main advantage would be so you could resell or rent when your kids are under the age of majority and hence are likely limited in their ability to enter into legal contracts.

[Granitepost]

This is actually quite a complicated area with respect to the taxation of trusts.  There are basically 2 types of trusts.  The first one is set up during your lifetime and the second is set up by a clause in your will.  The tax implications for the trust will differ in these 2 situations in Canada.

[Crip1]

Krazee,

 

A few questions and a comment:

 

1) Residential Real Estate in the US (Houses/Townhomes/Condos) to be rented out? I work for a mortgage company and can run your thoughts past our underwriters to see what issues you may encounter.

 

2) Making you a trustee for your kids?

 

3) In what states are you looking to do this (based on your moniker, I am thinking NY, CT or NJ but please clarify)

 

4) Pulling for your guys, and think you've got a good shot at it. The Seahawks have not been much offensively besides Marshawn Lynch recently and with Crabtree, your offense looks quite difficult to defend. Plus, I do not think highly of Pete Carroll so I hope you spank his team but good.

 

-Crip