subject: Estate Planning Attorney Explains How Parents Can Help Their Adult Children Purchase A First Home [print this page] Parents and grandparents with California estate plans have a unique opportunity between now and November 30, 2009 to use assets from their estate to help their adult children purchase a first home with little or no tax consequences to either them or their children or grandchildren.
Careful consultation with your California estate planning attorney is crucial to ensuring that the transaction does not trigger additional federal or state taxes or imperil the meticulous estate planning you have done in the past. There are several ways to use assets from your estate plan to assist your adult children with a first-time home purchase.
After consulting with your estate planning attorney, you may discover that you have appreciated securities that you can gift to your children and avoid the capital gains taxes on the assets. As long as your gifts do not exceed the $13,000 per year limit per individual, or $26,000 for married couples, you can avoid federal and state taxes all together if your child is eligible for the zero percent capital gains tax rate. Otherwise, you can always make gifts of cash.
Another option your estate planning attorney may suggest is to make a formal loan from assets if the adult child needs additional funds. Right now the Applicable Federal Rate (AFR) assigned to these intra family loans is extremely low, and now may be a once-in-a-generation opportunity to pass along wealth at such low rates.
Depending on the complexity of your estate plan and the vehicles contained within it, your California estate planning attorney may also be able to suggest additional ways for you to share your assets with your children while you are still alive and able to see them enjoy the benefits. A certified estate planning specialist is an estate planning attorney who has sought additional certification and is able to provide you with the most competent advice on your estate planning options. If you do not have a certified estate planning specialist, contact your local bar association for a referral to one.
If you would like more information concerning your estate planning options, consult a certified estate planning specialist who can walk you through the various options available to you in your estate plan. Whether your estate planning goals are immediate or long-term, a qualified estate planning attorney will be able to counsel you on the best options available to you to meet your individual needs.
by: Kevin Von Tungeln
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