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RayAnswers, Attorney
Category: Estate Law
Satisfied Customers: 42303
Experience:  Texas lawyer for 30 years in Estate law
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Can I create an irrevocable trust and keep a life time interest

Customer Question

Can I create an irrevocable trust and keep a life time interest on my home?
What happens if the property is then sold? Is there any tax consequence if I get a share of the net sale?
Submitted: 2 years ago.
Category: Estate Law
Expert:  RayAnswers replied 2 years ago.
Hi and welcome to JA. I am Ray and will be the expert helping you today. You could create an irrevocable trust and keep a lifetime interest.The trust does not fund here--the reminder interest passes here upon your death.So you create the trust and it funds with the remainder interest upon your death. The taxes are still in your name as life estate holder.Once the property is transferred when you decease the trust would be liable for any taxes due since they then hold title to the property. At the time the property goes into the trust, if it is later sold the trust or the beneficiaries would owe capital gains taxes on the difference between value at time trust took ownership and what it sells for when sold. Please let me know if you have more follow up.There were a lot of questions and you may have more. Thanks again for the chance to help you today.