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Community Property Trust Attorneys in Charleston

A Community Property Trust is a special kind of joint revocable trust designed for couples with low-basis assets, that is, assets that have not increased significantly in value since their purchase.

Advantages of a Community Property Trust

A Community Property Trust provides a number of advantages to compliment your revocable trust, including that it:

  • Allows a husband and wife to keep all jointly titled assets in the name of the trust

  • Saves spouses substantial amounts in capital gains taxes thanks to the double step-up

The double step-up is the readjustment of the value of an appreciated asset for tax purposes. Because most assets have a higher market value at the time of inheritance than they did at the time of purchase, the step-up in basis is the readjustment of the value of an asset when one spouse dies, passing on the increased value to the beneficiary. Typically, surviving spouses of jointly owned assets receive only one-half of the increased value when one spouse dies. In cases where a Community Property Trust has been established, the entire value of the property gets a basis step-up, which is why we use the term “double step-up” in such situations.

Not a particularly well-known strategy, establishing a Community Property Trust can be an enormous help to some couples, providing better cash flow and a greater retention of assets, but it is not a tactic that is useful for everyone. You should always be working with an experienced estate planning attorney in your home state who can advise you about which plan of action will work best in your particular case. Our knowledgeable attorneys at Wiles Law Firm, LLC are well-versed in all techniques that will keep your assets as high and your taxes low and will analyze which method is appropriate for you.

Where Community Property Trust Are Established

There are two states in which Community Property Trusts can be created: Tennessee and Alaska. Fortunately, for those of us in South Carolina, such trusts can be established in one these two states even if you don’t reside in either one.

The subject is confusing. Although there are nine community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin (ten if you include Alaska which has an optional community property system), the only two states in which married couples can create a community property trust are Tennessee and Alaska. The fact that couples from all over the country can partake of these trusts effectively gives them, at least for assets transferred into such trusts, the same benefits that so many of their countrymen already enjoy.

With the help of a community property trust attorney from Wiles Law Firm, LLC you can effectively “borrow” the Tennessee Community Property Trust law to eliminate capital gains tax on property that has appreciated by the time of the death of the first spouse. Using this strategy, your attorney will help you transfer highly appreciated "separate property state" property to a trust that takes advantage of the Tennessee Community Property Trust law. There is a requirement that a Tennessee trustee must oversee the trust property, but this is not difficult for your attorney to arrange. Once your Community Property Trust is in place, when the first member of the couple dies, the entire property steps up to its date-of-death fair market value. When the second spouse dies, his or her survivor or beneficiaries can sell the property and will only have to pay tax on post-death gains.

How Our Community Property Trust Attorneys Can Help!

Estate planning is all about providing a stable financial future for you and your family. Engaging a cutting-edge legal firm to handle the process is crucial to achieving positive results. You want to seek the counsel of an attorney who, in addition to being well-informed and efficient, is a good listener, someone who will take the time to understand your individual needs. At Wiles Law Firm, LLC, our attorneys are committed to helping you build a sturdy foundation for a safe and prosperous future for yourself and your loved ones. Contact us today to schedule a consultation.

Wiles Law Firm, LLC helps clients with their estate planning needs in Charleston, South Carolina and the surrounding areas such as West Ashley, Summerville, North Charleston, Mount Pleasant, and John's Island.

Information on this website is not legal advice. Further, viewing of the enclosed information does not create an attorney-client relationship with Wiles Law Firm, LLC. Matters will be handled by attorneys who primarily practice out of our office in Charleston County located at 852 Lowcountry Blvd., Ste. 101, Mt. Pleasant, SC 29464. M. Emerson Wiles, III is the attorney responsible for this advertisement.

Any result Wiles Law Firm, LLC may achieve on behalf of one client in one particular matter does not necessarily indicate similar results can be obtained for other clients. Please contact a South Carolina estate planning attorney or one of our attorneys with Wiles Law Firm, LLC for a consultation regarding your unique estate plan.

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852 Lowcountry Blvd., Suite 101, Mount Pleasant, SC 29464
| Phone: 843-718-0232

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