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 outlive the QPRT's term and want to continue living in the residence?
If you outlive the QPRT term, the residence would pass to the remainder beneficiaries. They would own the property. You could, however, lease the property back from the remainder beneficiaries at a fair market value rent. The obligation to rent your residence back from your children is viewed by some as a negative QPRT feature. However, many people view it as an opportunity to transfer additional assets, via rent payments, to their children. Renting will also transfer funds from the donor’s taxable estate, because the rents are not subject to gift tax