Passing on an asset to your loved ones may be a primary reason for you to make an investment and something you think about when creating your estate plan. However, you may not yet be ready to transfer your family vacation home to the next generation while your loved ones are still enjoying it, or if you are concerned that they may not yet be ready to manage the property.
Even so, it is important to think about what will happen to this asset when you pass away. There are many different options available to you and communicating with an experienced estate planning lawyer can help you make the best choice for you. You might decide to pass the vacation home at the time you pass away along with other assets, while giving each of your individual children and interest in the home. If their interests are equal, they will have certain rights including to partition and use the property. It can be difficult, however, to enforce other divisions such as benefits, labor and expenses.
Furthermore, a child may be within their rights to transfer their own interest in the home to someone outside of the family. This is a leading reason to work with an estate planning attorney to create a structure to care for and own the home following death. This can help to address issues like removal of the right to partition, restrictions on transfers and expense allocation.
You may also place the home inside a trust that is designed to own this type of property and provide for clarity. Passing on an asset and equal shares to your child beneficiaries may prove problematic if they do not all agree on what to do with the asset. Talking this through in advance and considering which of your children or other heirs may be interested is important.
