Randall Posted August 6, 2013 Report Share Posted August 6, 2013 Elderly man, no spouse. Will has everything going equally to children. Puts real estate in LLC, single member. Dies. Is LLC dissolved? Property to estate?. Step up basis to estate/beneficiaries? Puts real estate in a trust. Irrevocable grantor trust. Dies. Trust becomes irrevocable. Does trust get step up basis of property? Or is basis the grantor's basis when property is put in trust while grantor is still living? If they really just want to sell the property and distribute the money, why do a trust? Just keep property in Father's name or go with a single member LLC. Any comments on advantages or disadvantages? Randall J. Buys, CPA Erlanger, KY Quote Link to comment Share on other sites More sharing options...
jainen Posted August 6, 2013 Report Share Posted August 6, 2013 >>Any comments on advantages or disadvantages?<< There are entire books on this topic. No single answer is best for every combination. You need to work it out with the client, probably including subjective elements. For your technical question of basis, property gets a step-up if it is included in the taxable estate. (That's not the same as a probate estate.) Basis step-up is not always a good thing. 1 Quote Link to comment Share on other sites More sharing options...
Terry D EA Posted August 6, 2013 Report Share Posted August 6, 2013 I agree with Jainen that no single answer is best. i am assuming the property is held for rental?? If so, it is best to work it out with your client. Maybe involving an estate attorney might not be a bad idea either, Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted August 6, 2013 Report Share Posted August 6, 2013 Jainen is right, this series of questions do not have single answers. LLC for example, depends on state involved, as well as how the LLC Articals of Organization is written, etc. Quote Link to comment Share on other sites More sharing options...
Randall Posted August 6, 2013 Author Report Share Posted August 6, 2013 Nothing's been done yet. Will be meeting with client and attorney soon. My first concern is losing step up basis by moving the property into an entity and out of the individual's name. Father is old and dying and children want the property sold and distribute the money. At least from my preliminary understanding. Quote Link to comment Share on other sites More sharing options...
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