Should I Put My Primary Residence In A Trust?

When It Makes Sense

• Good fit: You have substantial assets and want to avoid probate for your primary residence, and you have a well‑structured revocable living trust already in place.
• Good fit: You expect to become incapacitated and want a seamless way for a successor trustee to manage or sell the home without court involvement.

When You Should Avoid It

• Warning sign: You live in a state where transferring a home into a revocable trust triggers a reassessment of property taxes that could significantly increase your yearly cost.
• Warning sign: Your mortgage lender requires the borrower to remain the legal owner and does not allow the property to be titled in a trust.

Pros and Cons

Pros

• Probate avoidance: Upon death, the home can pass directly to beneficiaries without the time and expense of probate.
• Incapacity planning: A successor trustee can manage the property if you become unable to do so, avoiding the need for a guardianship proceeding.

Cons

• Potential tax consequences: Some jurisdictions reassess property value when transferred to a trust, leading to higher property taxes.
• Administrative effort: You must retitle the deed, update homeowners insurance, and maintain trust records, which adds complexity.

Decision Checklist

• Do you have a revocable living trust already, and does it contain provisions for your home?
• Will transferring the house affect your mortgage terms, property tax assessment, or eligibility for any exemptions?
• Have you consulted an estate‑planning attorney and a tax professional to confirm that the benefits outweigh the costs?

Alternatives to Consider

Instead of placing the home in a trust, you might use a payable‑on‑death (POD) deed, a transfer‑on‑death (TOD) registration, or a joint tenancy with right of survivorship. These options can also bypass probate while avoiding some of the tax or lender complications associated with a trust.

Final Recommendation

If you already have a revocable living trust, own the home outright or have a lender that permits trust ownership, and you value probate avoidance and incapacity planning, transferring the residence to the trust is a reasonable choice. However, if you face potential tax reassessment, mortgage restrictions, or lack professional guidance, you may want to explore POD/TOD deeds or seek expert advice before proceeding.