When a person passes away, his or her successors might end up paying a considerable quantity of cash in order to claim the property delegated them from the testator’s estate. Much of this money is due for real estate tax. Luckily, there are methods that a person can reduce the costs his/her beneficiaries will assume by taking proactive actions.
Prevent the Probate Process
Avoiding the probate process can potentially allow beneficiaries to prevent needing to pay property taxes. Additionally, heirs can prevent the trouble and expenditure related to the probate process.
Avoid Real Estate Tax Reassessments
Normally when a property transfers ownership, a reassessment is carried out. This often triggers there to be extra property taxes due, pursuant to California’s Proposition 13. Proposal 58 enables an individual to transfer ownership to a child without setting off the change in ownership rule and permitting them to avoid the reassessment. A Claim for Reassessment Exclusion need to be timely submitted in order to prevent this procedure.
Establish a Trust
Setting up a trust may accomplish both goals discussed above. When property remains in a trust, the trust lawfully owns the property. The grantor sets up the trust, a trustee manages the trust and a beneficiary receives the advantage of the trust. If a living trust, the trust can be used for the grantor’s needs throughout his or her lifetime. Extra guidelines can discuss how the trust funds will be used for the advantage of the beneficiaries.
Individuals who would like support in preventing real estate tax may choose to get in touch with an estate planning legal representative for help and guidance. He or she may have the ability to discuss options that are available given the specific situations.