Part of estate planning is determining what happens to your vacation home. You could choose to sell it before your death, but if you want to keep it in the family, you need to make legal arrangements now. If you are deciding what to do with your vacation property, here is what you need to know.
What Are the Challenges?
There are several challenges that you can face when deciding how to settle what happens with your vacation home. For instance, if you have more than one child, you have to decide if you are going to leave the home to one child or divide its ownership among all of them. If you do name all of your children as equal owners, how will decisions be made about the home? Will one child have more say than the others?
You also have to consider the possible tax and financial consequences that come with leaving a home to a family member. Is your relative financially able to pay the property taxes and maintenance-related expenses that come with owning the home, such as the homeowners association fees?
One of the most important challenges you could face is potential conflict between family members who might not agree with the choices that you make regarding the home. Failing to handle the issue correctly could potentially lead to your will being challenged in court.
What Can You Do?
You have several legal options available to you when it comes to your vacation property. One possible option is to establish a trust and move the ownership of the home to it. Instead of leaving your family members responsible for the financial aspect of the home, the trust would be. Leaving the home to a trust also helps to avoid probate.
Another option is to create a limited liability company. The ownership of the home could be transferred to the company and gives you greater control over what happens with the property. For instance, you could use the company to prevent your family members from having a forced sale of the vacation home. You can even use it to determine how maintenance is handled and if the property can be rented to others.
Your probate attorney can help you determine the best way to handle your vacation home. He or she will help you explore the legal and financial implications of each possibility before you make your decision. Visit a site like http://valentineandvalentine.com for more information.