What You Should Know About Real Estate Trusts in Texas

Preparing for the passing of a loved one can ease the burden of grief. For those with wealth, concerns about high gift taxes may arise. Planning how your estate will be distributed brings comfort to grieving loved ones and reassurance about the future of your home. If this isn’t your envisioned scenario, consider learning what you should know about real estate trusts in Texas.

A trust moves the ownership of your property out of your name and into a trust, managed by a trustee, to protect your heirs. Without a plan, your heirs might face arguments, court battles, taxes, and debt collectors.

Why Trusts Matter

Putting real estate into a trust in Texas helps beneficiaries avoid a lot of paperwork and delays during a tough time by skipping probate court. Probate is slow and costly, taking months or even years to finish. The court also handles giving out money and paying off any debts. A will tells the trustee how to divide the assets. Without a will, the court decides, usually following state rules about inheritance and giving the property to heirs. The heirs get the money when the property sells, if it does.

Every year, the amount you can give or leave as a gift or inheritance changes to match living costs. In 2021, it was $11.7 million for individuals and $23.4 million for couples. If you’re married and your spouse passes away, their limit adds to yours. Putting your house in a trust can help your heirs avoid gift taxes, which can range from 8 to 40 percent and are usually paid by the giver. Estate taxes are levied when someone dies, but having the house in a trust can shield it from creditors. Trusts keep wealth transfers private, unlike probate, which is public record.

Setting Up a Trust

In Texas, real estate trusts come in many different types, so it’s crucial to look closely at your options before choosing the right one for your estate. Your estate might be worth more than you think, and setting up a trust can ensure your heirs inherit it smoothly. First, gather all your important documents and take a realistic look at what you own. If you want to provide extra income for a family member, you can make a special needs trust. And if you have a family member who’s not great with money, you can make a spendthrift trust to protect them from creditors and limit their access to the funds. Once a trust is irrevocable, you can’t change your mind about transferring your home or other assets into it. But irrevocable trusts often let your beneficiaries avoid estate taxes, so think carefully about your decision.

You have a few options for setting up a trust. You can do it yourself, use an online service, or get help from a lawyer. It’s best to talk to a legal expert to make sure everything’s done correctly. You’ll also need to pick someone to manage the trust after you’re gone, so talk to them to make sure they’re okay with it. Then, you’ll need to create the trust documents and transfer the property deed into the trust. You’ll be the trustee, which means your name and the date will be on the title of the property in the trust.

If you need to sell after losing a loved one, LJE Property Solutions Buys Houses can assist you. We want to make things easy for you with a quick process. We’ll give you a fair cash offer and can close in just a few days or weeks. LJE Property Solutions Buys Houses knows it’s a tough time, so their experienced team is ready to help with any questions or worries you have. You can reach out by sending a message or calling LJE Property Solutions Buys Houses at 512-230-3469.