Qualified Personal Residence Trust

A qualified personal residence trust (“QPRT”) is a trust created during the life of an individual or married couple to accept a transfer of personal residence. The trust typically provides that the residence is held for the benefit of the individual or married couple for a certain number of years, after which it is transferred to the beneficiaries, typically the next generation in the family. The transfer of the residence to the QPRT is a taxable gift and a gift tax return must be filed at that time. However, the value of the residence is discounted for the purpose of the gift tax return, thus eliminating or reducing the gift tax liability resulting from the transfer of the residence to the beneficiaries. If the individual dies during the period of his retained interest, the tax advantage will be lost. Attorney Rubino can explain the possible risks and rewards of the QPRT and can work with you and your family to determine if the QPRT estate planning technique is right for you.