Qualified Personal Residence Trusts (QPRTs) Can Still Be Useful Estate Planning Tools – Los Angeles Estate Planning and Asset Protect Plan Attorney Bruce Givner

by Bruce Givner on September 17, 2012

"The current $5.12 million per-person exemption from federal gift and estate taxes encourages high net worth income individuals to set-up trusts for lifetime gifting," noted Los Angeles Estate Planning and Asset Protect Plan Attorney Bruce Givner.  "While Family Limited Partnerships (FLPs), Grantor Retained Annuity Trusts (GRATs), and Intentionally Defective Grantor Trusts (IDGTs) are currently in vogue, a Qualified Personal Residence Trust (QPRT) is still an excellent tool that can also be used alone, or in combination with any of these other trusts."

"With a QPRT, an individual (grantor), typically the parent, transfers his or her personal residence to the QPRT, but retains the right to live in the personal residence for a specified number of years," continued Givner, who has created thousands of trusts for clients throughout California.  "At the end of the term of years, the QPRT ends, and the personal residence passes to or is held in further trust for the remainder beneficiaries, typically the children.  Any appreciation in the value of the personal residence thus is excluded from the grantor’s taxable estate," added Givner.

QPRTs work well when the interest rate is high.  However, even with the current low interest rate environment, a QPRT is a useful estate tax planning tool.  Though real estate values are depressed, QPRTs will allow the tax free shifting of the appreciation to the next generation.
Givner & Kaye focuses on sophisticated estate planning and asset protection plans for individuals and businesses in Beverly Hills, Calabasas, West Los Angeles, Hollywood, and other areas of Los Angeles County.  Call Los Angeles Income Tax and Asset Protection Plan Attorneys Givner & Kaye at (310) 207-8008 today.

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