THE MALDEN ADVOCATE–Friday, August 8, 2025 Page 17 - LEGAL NOTICE - City of Malden Massachusetts INSPECTIONAL SERVICES 215 Pleasant Street, 3rd Floor Malden, Massachusetts 02148 (781) 397-7000 ext. 2030 MALDEN SITE PLAN REVIEW COMMITTEE for ACCESSORY DWELLING UNITS PUBLIC HEARING The Malden Site Plan Review Committee for Accessory Dwelling Units will hold a public hearing in Malden City Hall, 215 Pleasant Street, Malden, MA, Mayor’s Conference Room, 4th Floor, at 6:00 P.M. on Tuesday, August 26, 2025, on the petition of Liliana Monroy, filed in Permit Application #RES072179-2025 under Title 12, Code of the City of Malden, Section 12.32.030.D, seeking Site Plan Review and Site Plan Approval of a proposed Accessory Dwelling Unit to be constructed in the basement of the existing two-family dwelling, at the property known as and numbered, 19 Monroe Street, Malden, MA, and by City Assessor’s Parcel Identification #169 540 005. Petition and plans are available for public review in the Inspectional Services Department, Malden City Hall, 215 Pleasant Street, Room 330, Malden, MA and through the City website under Permit Application # RES072179-2025 at https://maldenmaenergovweb.tylerhost.net/ apps/SelfService#/home Nathaniel Cramer, Chair August 8, 15, 2025 - LEGAL NOTICE - City of Malden Massachusetts INSPECTIONAL SERVICES 215 Pleasant Street, 3rd Floor Malden, Massachusetts 02148 (781) 397-7000 ext. 2030 MALDEN SITE PLAN REVIEW COMMITTEE for ACCESSORY DWELLING UNITS PUBLIC HEARING The Malden Site Plan Review Committee for Accessory Dwelling Units will hold a public hearing in Malden City Hall, 215 Pleasant Street, Malden, MA, Mayor’s Conference Room, 4th Floor, at 6:00 P.M. on Tuesday, August 26, 2025, on the petition of Fekadu Kechena, filed in Permit Application #RES072606-2025 under Title 12, Code of the City of Malden, Section 12.32.030.D, seeking Site Plan Review and Site Plan Approval of a proposed Accessory Dwelling Unit to be constructed in the existing detached garage of the existing two-family dwelling, at the property known as and numbered, 18-20 Stearns Street, Malden, MA, and by City Assessor’s Parcel Identification # 086 412 204. Petition and plans are available for public review in the Inspectional Services Department, Malden City Hall, 215 Pleasant Street, Room 330, Malden, MA and through the City website under Permit Application # RES-072606-2025 https://maldenmaenergovweb.tylerhost.net/apps/SelfService#/home By: Nelson Miller Chair, Site Plan Review Committee August 8, 15, 2025 T here are several reasons why one might look to a transfer to an irrevocable trust instead of an outright gift of assets to children. Below are a few of those reasons: 1. If a parent simply makes a gift of an appreciated asset to a child, for example, upon that parent’s death there is no “stepup” in cost basis equal to the fair market value of the asset as of the date of death. Whatever that person paid for the asset originally, becomes the cost basis in the hands of the children and on a subsequent sale there may very well be a significant capital gain. The asset could be appreciated real estate or stock. We refer to the cost basis tax concept where a parent simply makes an outright gift to a child as “carryover cost basis”. A properly drafted irrevocable trust will provide for the step-up in cost basis of the appreciated asset so that upon the individual’s death, the fair market value at that point in time is used to determine cost basis going forward. The trust is drafted so as to include the asset as part of the taxable estate. If the gross estate is less than $15 million for federal estate tax purposes (as of 1-1-26), there will be no federal estate tax. In Massachusetts, the exemption has now risen to $2million. So in all likelihood, there will be no federal estate tax (and possibly no Massachusetts estate tax as well) to be paid upon death and the children will get to use the fair market value at date of death for purposes of determining capital gains and losses in the future. That is certainly a lot better than using the purchase price of the asset 50 years ago IRREVOCABLE TRUSTS as the children’s starting point. 2. Control of assets. If assets are transferred to an irrevocable trust, the Settlor/Donor of the Trust can still maintain control over the trust assets by serving as Trustee. Even if the Settlor/ Donor is not the Trustee, he or she can retain the power to remove the Trustee and name a successor trustee if he or she is not happy with the way the trust is being administered. If serving as Trustee of an irrevocable trust, the Settlor/Donor would not need the consent of the children to sell real estate that is housed in the trust. He or she could sell the real estate, invest in another piece of real estate or sell the real estate and simply invest the sales proceeds in a stock, bond, or mutual fund portfolio, money market account, annuity, etc. The key is that the irrevocable Trust must be drafted properly if the Settlor/Donor of the Trust is to serve as Trustee. The Settlor/Donor cannot, under any circumstances, be entitled to receive any principal from the Trust. Only income can be distributed to the Settlor/Donor of such a Trust. 3. The irrevocable Trust has significant more safeguards in terms of protecting the trust principal. Creditors of the children would not be able to attach the assets while held in the irrevocable trust. If the assets were given to the children directly, no such protection would be provided. There are so-called “spendthrift” provisions that are designed to protect the beneficiary’s interest that is held in the irrevocable trust. The Settlor/Donor has the right under well-settled trust law to include such provisions in order to protect children against possible future creditors, spouses in a divorce proceeding or even against a bankruptcy filing. 4. The irrevocable trust will also protect a beneficiary’s own children if that beneficiary were to die prematurely. The beneficiary’s share will remain in trust for his or her own children with the trustee able to distribute income and/or principal for the children’s health, education, maintenance and support. Only at certain ages would the children be able to demand from the trustee to withdraw his or her share of the trust. If a beneficiary is incompetent, or if the beneficiary is suffering from alcoholism, drug addiction or a gambling addiction, the trustee would have discretion not to allow for distributions of principal, which would only result in the money being squandered. Only an irrevocable trust can provide for this feature. Outright gifts simply cannot. 5. Capital gains exclusion on the sale of the home. An irrevocable trust will also provide for the Internal Revenue Code Section 121 capital gain exclusion on the sale of the principal residence in the amount of $250,000 for a single taxpayer and $500,000 for a married couple. Even though the house is placed in the trust, the exclusion will still apply. This avoids the situation where the house is sold by the children who might be the remainder men on the deed subject to a life estate in the mother or father. If the children do not live in the home, no exclusion is available to them. Only the portion of the sale attributable to the value of the life estate will be afforded the capital gain exclusion. Furthermore, if the mother or father were on the verge of going into a nursing home, the sales proceeds attributable to the mother or father would have to be spent down on nursing home care. No such problem exists with an irrevocable trust. The irrevocable Trust is drafted as a grantor-type Trust thereby allowing the Settlor/Donor to take advantage of the capital gain exclusion on the sale of the principal residence. Joseph D. Cataldo is an estate planning/elder law attorney, Certified Public Accountant, Certified Financial Planner, AICPA Personal Financial Specialist and holds a master’s degree in taxation.
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