Legal Question in Real Estate Law in California

Re: Living Trust and Sale of Home

Not all living trusts are identical in this respect, so I'd urge caution; however, most revocable living trusts are tax-transparent. That is, they don't file tax returns and don't have tax liabilities separate from the trustor.

Therefore, the same rules regarding treatment of capital gains from sale of your principal residence would usually apply even though the house is in a revocable living trust.

To be certain, you should consult the attorney that drafted the trust.

Re: Living Trust and Sale of Home

That reminds me of the guy who asked his doctor if he would be able to play the violin after surgery. The doctor said, "yes, of course." The guy said, "That's fantastic, because I never played the violin before." If you could do it before creating the revocable trust, you can do it after, but not the other way around.