Planning for Life after a QPRTPlanning for Life after a QPRT

A qualified personal residence trust (QPRT) is an estate-planning vehicle that allows a homeowner to transfer his home to a trust, while retaining the right to live in it for a term of years. This technique allows the individual to transfer the house to beneficiaries at a reduced gift tax cost and remove an asset expected to appreciate in value from his estate. When the estate lifetime exclusion was lower and there was no portability of each spouse’s exemption, the use of QPRTs gained in popularity. Many of these trusts are just now approaching their termination date and will require proper planning to ensure a smooth transition for everyone involved.

Because there’s no limit on how long the QPRT must run, it’s not uncommon to see QPRTs t...