A personal residence trust (PRT) is a trust that clients can use to save considerable money by minimizing the value of a gift for tax purposes. When a residence is transferred into a PRT it is considered a completed gift. If a grantor retains interest in the PRT by living in the house then the trust becomes known as a qualified personal residence trust (QPRT). This is a very complicated area of the law and it is up to financial advisers to help properly guide their clients. There are a lot of potential tax savings that people can gain by making the right well planned out decisions.
See Eleanor O’Sullivan, How To Save With Personal Residence Trusts, Private Wealth, November 9, 2015.
Special thanks to Jim Hillhouse for bringing this article to my attention.
