Expert: Dick Dennis - 9/27/2006

Question
Dear Mr. Dennis,

I have lived in the house that my Grandmother had built for me and my family since March of 1999. Originally, upon her death, the house was to be left to me, however, my Mother, who is the executor of the estate had everything changed prior to my Grandmother's death and now the property is in a living trust. (The house has no mortgage) My husband and I have decided to move as our children are grown and we would like to leave Florida. I have spoken with my Mother and she has agreed to allow me to sell the house.  She has told me she wants to place a certain amount of funds in trust to remain for my 18 year old son and that's fine with me.  My question is who, if anyone will be responsible for any capital gains taxes, or will I have to invest the whole smount of the sale into another property to avoid any taxes.

Thank you in advance,

Karyn

Answer
If the house is in a LIVING trust, Karyn, there is a trustee named first. Then there are successor trustee(s) named. If you are the main trustee, then you should not have to pay any capital gains tax based on IRC121. If the main trustee is someone else, then it is handled differently. I strongly suggest you consult with a tax expert to make sure you are handling this whole affair correctly.

I do wish you well

Dick Dennis