#CONVEYANCE OF PROPERTY TO A TRUST FREE#

We therefore conclude that Paul’s interest in his residence as beneficiary of his own revocable trust would entitle him to constitutional homestead protections (emphasis added) Accordingly, he maintained an ownership interest in his residence, even though a revocable trust held title to the property.

#CONVEYANCE OF PROPERTY TO A TRUST FREE#

Because Paul retained a right of revocation, he was free to revoke the trust at any point in time. We note that in this case while Paul’s residence was held in a revocable trust, it was owned by a “natural person” for purposes of the constitutional homestead exemption.

There, the Fourth District Court of Appeals stated: The issue arose whether his primary residence held in the Trust constituted Paul’s homestead. 4 th DCA 2006), Paul Engelke died leaving a Trust. Florida’s own courts have ruled that when a person’s primary residence is titled in a Trust, it is held by a natural person. However, Bosonetto is no longer good law. Unfortunately, the court’s ruling in Bosonetto was not appealed so for a number of years after that ruling, Florida attorneys discouraged clients from putting their homestead into their Trust. In that 2001 case, the court ruled that a Trust was not a “ natural person” and therefore the homestead was not entitled to the protection from creditor claims. In that case, the court considered whether a person’s homestead protection extended to a situation where the homestead was transferred into the person’s Trust. Years ago, there was Bankruptcy case known as In re Bosonetto, 271 B.R. So preserving that homestead protection is important. If you own a homestead and you get sued, the creditor cannot touch your homestead. So a homestead (primary residence) is protected from creditor claims if it is owned by a natural person. (a) There shall be exempt from forced sale under process of any court, and no judgment, decree or execution shall be a lien thereon, except for the payment of taxes and assessments thereon, obligations contracted for the purchase, improvement or repair thereof, or obligations contracted for house, field or other labor performed on the realty, the following property owned by a natural person: (1) a homestead. Article X, Section 4 of the Florida Constitution provides, in pertinent part: Homestead property is protected from the claims of creditors. Aside from these lawyers someday getting to probate the homestead, why would they advise against placing the homestead in the Trust? In order to answer this question, a little background is helpful. This having been said, some lawyers discourage clients from placing their homestead into their Trust. One question which we commonly hear in our estate planning practice is “Should we transfer our homestead into the Trust?” From the standpoint of avoiding probate, the answer is an emphatic “yes!” Avoiding probate can save your family and loved ones time, money and aggravation. This allows those assets to pass outside of probate. In order to be effective, once the Trust is executed, certain assets need to be transferred into or re-titled in the name of the Trust. One advantage of having a Trust is that it avoids assets or property having to go through probate. We have reviewed our content for bias and company-wide, we routinely meet with national experts to educate ourselves on better ways to deliver accessible content.įor 15 years our company has published content with clear steps to accomplish the how, with high quality sourcing to answer the why, and with original formats to make the internet a helpful place.Many Florida estate plans include setting up a revocable living trust (“Trust”). Our commitment is to provide clear, original, and accurate information in accessible formats. We are incredibly worried about the state of general information available on the internet and strongly believe our mission is to give voice to unsung experts leading their respective fields. Our content experts ensure our topics are complete and clearly demonstrate a depth of knowledge beyond the rote. We perform original research, solicit expert feedback, and review new content to ensure it meets our quality pledge: helpful content – Trusted, Vetted, Expert-Reviewed and Edited. We write helpful content to answer your questions from our expert network. Reviewed by Michelle Seidel, B.Sc., LL.B./JD, MBA

Conveyance of property to a trust