If you invest in property at any point in your life, it’s likely that some of your real estate purchases become important assets in your estate plan. Second homes and vacation homes are a popular investment, between buying an attractive property in a growing area or using the space to make additional income through short-term rentals.
Second or vacation homes that have been in the family for a long time also accrue emotional attachment. Some family members—maybe your own children—grew up in them and made many enduring memories there. Both the emotional and financial value of a vacation home point to the need to include it in your estate plan.
If your vacation or rental property is out-of-state, it can certainly be included in your estate plan. Our team is well-equipped to handle any assets of yours that are located outside of Massachusetts, by consulting with a network of attorneys in other states; however, there are some important considerations to keep in mind.
Because different states have different laws and processes, it’s crucial to also avoid probate in other states in which you have assets as well as your home state. We at Family Estate Planning Law Group are ready to help you navigate the tough legal questions about this and help you determine the right way to move forward with your out-of-state property. We will typically do this through setting up a trust and coordinating with an attorney in the area your property is located.
After making sure your out-of-state properties are properly accounted for and aligned with your trust, the other elements of estate planning for your family’s vacation home take on a more personal focus. In our Family Care MeetingsTM for clients and their families, our team provides an opportunity for everyone involved to be on the same page about where assets will go. This is where you can communicate with everyone about your wishes for how your vacation home will be owned and used..
If the family vacation home is in your trust, then whoever you name as trustee(s) will receive ownership after you die and the trust’s beneficiaries—that is, your children and/or other heirs—will be able to use it or receive rental income from it. Or, you can leave instructions in your trust for a transfer of ownership after you’re gone to a separate share trust for a single person or multiple people who would have equal ownership. There are many methods that can work for your requests, and we can help you find which one will be the best fit.
Part of the beauty of a customized estate plan is that you can provide instructions for your wishes. You can write up a set of instructions with details for keeping your vacation home in the family after you’re gone. You may want to set aside some funds for repairs, regular maintenance, or planned improvements to the property. You may want to set guidelines on how the house can be rented when the family isn’t using it. Or, you can even create a plan for multiple generations, which may be particularly useful to ensure the continued existence of a beloved second home.
The key takeaway is that having an out-of-state home isn’t cause for more worry in estate planning. At Family Estate Planning Law Group, we will help you create a customized plan in accordance with your wishes so you can have peace of mind, because no family wants to lose the summer or winter home that they’ve come to cherish. Through our ongoing client care program, we’ll be with you every step of the way to make sure your vacation home is protected along with all of your other assets, whether it’s a recent addition or an older house that’s a part of the fabric of your family.