In this episode of Coffee with Carl, attorney Carl Zoellner explains the relationship between homestead exemptions and trusts.

Updated September 21, 2021

If you watched the previous episode of Coffee with Carl, you may have some questions about how the homestead exemption works with other strategies. Specifically, how do trusts fit in?

Here at Anderson Advisors, when we help with your estate planning, we suggest putting your personal residence into a living trust. Additionally, we recommend land trusts as an investment strategy, depending on the business situation.

Relatedly, a question I often see from Platinum clients is: will putting my personal residence into a trust violate my homestead exemption?

Frankly, the answer is no. Grantor trusts (living trusts and land trusts included) allow you to put your personal residence in the trust without violating your homestead exemption.

There is a lot of misinformation surrounding this area. Plus, there are some intricacies in certain states or counties. For instance, in some counties in Texas, specific language is required noting that the grantor intends to use the property as their personal residence.

Ultimately, what it comes down to is simple. Putting your personal residence into a grantor trust (living trust or land trust) will not violate your homestead exemption. Just make sure it’s done by qualified professionals.

Watch as Carl covers how holding your personal residence in a trust works with your homestead exemption.

Resources mentioned in this video:
Check out Tax Tuesday for FREE tax advice from tax attorneys & CPAs
Find more great business resources on our YouTube channel

Got an idea for a future Coffee with Carl? Send it to Carl at cwc@andersonadvisors.com.

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