Qualified Personal Residence Trust
- How does it work?
- What are the key benefits of a QPRT??
- If I have a second home, can I use the QPRT for both homes?
- Is a gift tax return required when a gift is made to a QPRT?
- Are there any other tax benefits offered by a QPRT?
- What If I Die During the QPRT's Term?
- Does my age and the QPRT term affect the tax consequences of the QPRT?
- What if I outlive the QPRT's term and want to continue living in the residence?
- Can the residence be sold while it is in the QPRT?
- Will my children receive the residence with step up in basis at the End of the QPRT Term?
- Do any income tax returns have to be filed in connection with a QPRT?
What If I Die During the QPRT's Term?
If you die during the term of the QPRT, the residence would be included in your estate at its full fair market value at the time of year death. Although the asset protection benefits would have been realized, the tax and economic benefits of the QPRT would be lost. However, you would be no worse off than if you had not created the QPRT, other than transactional costs in establishing the QPRT. Also, the gift tax credits used initially or any gift taxes actually paid would be restored for use in transferring your estate to your heirs.