Should
it be maintained for close relatives? Will the next generation use it together
or separately? Is it the site of family reunions? If not, will it be available
to friends or even renters?
Few places prove to be so
powerfully uniting for a family as the family vacation home. Cabins, beach
houses, you name it – a vacation home is a desirable property. And since it is
so pleasing to the family, this seemingly relaxing place can unfortunately become
a sore spot when it comes to planning for it in your estate.
Estate planning is about
planning for three things: the needs of your family, the straightforward assets
you have, and the difficult assets you have (whether to transfer, own or both).
Curiously, planning for your vacation home is about all three of these things
in one.
Forbes recently considered the precarious balance between getting
it right and getting the family into a fight over the vacation home in an
article titled “The Family Cabin: Private Retreat Or
Isolated Battleground?”
To plan for the vacation home,
as with the family home, the family business, or anything truly precious, it
pays to plan openly with your family and to plan decisively. Some family
members may not want the house, and some might not be able to keep the house
even if you gave it to them. On the other hand, perhaps everyone wants it.
Having an open discussion within
the family, or even just one member at a time, allows you to uncover whether
what they want is what you want for them and vice versa. After conducting your
research, design and implement your plan. Once everything is in place and the
ink has dried, then inform them of your plan and stick to it.
Some legal tools to consider
include trusts, like a QPRT (Qualified Personal Residence Trust), or perhaps
formal business entities to own the vacation home and share it amongst your
heirs. There is a lot of room for creativity.
Take a look at the original
article and begin exploring this subject with your family. Regardless, be sure
to enjoy the rest of these warm summer days wherever your family vacation home
is.
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Reference: Forbes
(August 12, 2013) “The Family Cabin: Private Retreat Or
Isolated Battleground?”