A common question I get is whether or not creating a living trust means you will have property tax consequences or changes. I often suggest my clients get a living trust, especially if they own property in the state of California. But, a major drawback seems to be the possibility of causing a property tax reassessment if anyone touches the title to the property. No one wants the added stress of a reassessment, but please note that there are exemptions for this. You simply have to look for them.  Why Choose a Trust in the First Place?  Most people tend.

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We’re going to talk about whether you need a trust if you own a home, right? So, you own one piece of property. Let’s just say, you own one home, and that’s where you live. And you have a modest account in the bank, and you have to ask yourself, do you need a trust?  These living trusts, you’ve heard about them. Is it necessary for you? If the house is here in California, the answer is absolutely. There are rarely any houses out here in California that are less than $150,000, and therefore, it will go through probate if.

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Will there be property tax consequences to making a living trust? So I keep telling people that they probably need a living trust, especially if you own property here in California, but many people are worried that if they touch the title that it will create a property tax reassessment.  I’m here to tell you that there is an exclusion for that, that you don’t have to worry about that. You could transfer property you own into a living trust without a reassessment. Now the only caveat to that is if it’s jointly held with another person that’s not your.

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Why do I need a power of attorney if I have a trust? How do they play together? Well, this is very important. So again, this all starts with a trust.  A trust is a bucket. You fill it up with things. Now if you become incapacitated or go into the hospital and can’t make decisions, the trust turns on and when it turns on the powers of the trust control, another person could come into place and manage those assets. But what happens if those assets are not part of a trust, right?  Let’s say they are left outside.

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