Legal Question in Wills and Trusts in Massachusetts

Re: Trust termination/tax consideration/real estate transaction

A trustee has a fiduciary duty to the Trust and all of its beneficiaries. I would suggest that you need an attorney to assist you in winding up the trust and selling the home.

You are obligated to sell the home for a reasonable value, which is normally market value.

Issues of capital gain are determined by the trusts basis, which may or may not be increased as of the date of death of the settlor(s) or nine months after depending upon whether this was a revocable trust or irrevocable trust at the time of death.

As to the sale between the Trust and a beneficiary of the trust, I would contact an attorney who does both probate and real estate to assist me.

This should not be complicated or very expensive and is cheaper than paying your own attorney (trust pays for the attorney to deal with this) if someone gets made afterward.

Please feel free to call me if you have additonal questions.

Re: Trust termination/tax consideration/real estate transaction

I agree with these other attorneys. At a minimum you shuold have an experienced attorney review the trust language and look at the real estate transaction as it relates to any tax implications and to equitable distributions among the siblings. As trustee, you owe a duty to your siblings to act in their best interests. Hiring professional assistance would be in everyone's best interests here.

Please let me know if I can assist you.

Re: Trust termination/tax consideration/real estate transaction

As a trustee, you may face significant personal liability if you bite off more than you can chew by trying to do this yourself. The trust will pay for the attorney to wind up the trust; but YOU may pay your own legal bills if you are sued and a court finds you to have negligently mishandled the trust's termination, and you may be ordered to repay the trust for the losses you caused because you tried to do everything yourself. Think of it this way -- the attorney carries malpractice coverage in the event that he should get sued for mishandling a matter. You probably don't.

Your questions about capital gains is another reason to retain an experienced attorney. The answer turns on the financial facts, the trust's language, and how those fit in with tax law. Some attorneys will work with accountants in evaluating tax strategies and preparing final returns. Some attorneys do it themselves.

Yes, Massachusetts does require an attorney's involvement in the sale of real estate. Purchase and sale agreements are contracts -- and again, as a trustee, you have a fiduciary duty to your siblings to be sure that the transaction is correctly handled. Your attorney is there to be sure that there are no legal roadblocks between the buyer and seller, or problems which may come back to bite after the sale occurs.

My office is in Needham, just off of Route 128. Please feel free to give me a call if I can be of assistance.

Re: Trust termination/tax consideration/real estate transaction

As a probate attorney, I typically work with the decedent's CPA in carrying out the legal and accounting aspects of the estate, at the direction of a trustee or executor. It is not uncommon for the estate attorney to prepare (and defend) the estate tax return, in coordination with the CPA who prepares the fiduciary income tax returns and or final return of the decedent.

Generally speaking, an attorney is typically representing sellers in Massachusetts real estate transactions, while occasionally, the buyer is represented by lender's counsel. Infrequently would a transaction take place without an attorney. The attorney will make sure that the necessary steps have been accomplished prior to sale and or listing for sale, including completion of necessary probate steps and or making sure the listing agreement reflects the proper state of estate administration.

Please feel free to call my office if you would like to set up an appointment. I can assist you in all of the foregoing, including recommending CPAs who are experienced with fiduciary returns for estates and trusts. I have represented estates and trusts (in some cases as executor, administrator, or trustee) in the probate process, and represent buyers and sellers in residential real estate transactions.