Canadian/Foreign Owner Real Estate Trusts
Many Canadians and other foreign nationals buy real property in the Palm Springs area, either as a vacation home or for investment purposes. In many cases, it makes sense to hold the real property in a trust. Sanger and Manes is a leader in establishing real estate trusts for that purpose.
For non-US citizens, the benefits of holding real property in a simple revocable trust are significant. A revocable trust can avoid a costly and time-consuming probate when the owner dies. It allows the owner to easily change beneficiaries with a simple trust amendment, rather than having to redraft and resign a Will in Canada or overseas. Post-death administration of the real estate, whether paying bills or filling property tax exemptions, is usually made easier. If done properly there should be no adverse tax consequences in the owner's home country.
A revocable trust generally will not protect the owner from creditors or avoid or delay US estate taxes. Those benefits require more complex and sophisticated estate planning, including the establishment of an irrevocable cross-border trust, or using other entities to hold the property.
Sanger & Manes has an expertise in counseling foreign property owners on the trust that makes sense for them, drafting trusts to hold the real property, transfering the property to the trust, and advising trustees on how to administer the property upon the owner's death, from preparing the required forms to make use of the proper estate-tax exclusions under tax treaties, to preparing property tax change of ownership papers, to transferring the property to the intended beneficiaries. There is no law firm in the Palm Springs/Rancho Mirage/Palm Desert area with more experience in establishing and counselling real estate trusts for non-US citizens than Sanger & Manes.