Page 16 THE MALDEN ADVOCATE–Friday, December 24, 2021 PRINCIPAL RESIDENCE PROBATE, MASSHEALTH AND CAPITAL GAINS TAX CONSIDERATIONS I f you transfer your home to an irrevocable trust in order to protect the home from the possibility of going into a nursing home, there are several benefits of doing so. First and foremost, once your home is transferred to an irrevocable trust, the five-year look back period commences in order to protect the home in the event of one or both of the Donor’s of the trust enters a nursing home and needs to apply for MassHealth benefits. Another benefit of an irrevocable trust is the avoidance of probate upon the death of the Donor(s) of the trust. Certainly, if a husband and wife own the home as tenants by the entirety, probate would be avoided upon the first spouse to die. If the surviving spouse does not take action to place the home either into a revocable trust or irrevocable trust, upon the death of the surviving spouse, the children would have to initiate probate proceedings in order to obtain title to the home. A simultaneous death, although very unlikely, would also result in the children having to probate the estates of both spouses. Having a funded irrevocable trust would obviously avoid the negative ramifications of that unlikely event. When you place your home into an irrevocable trust, you also obtain the benefit of being able to sell your home and take advantage of the Internal Revenue Code Section 121 capital gains tax exclusion on the sale of your principal residence. The trust will be drafted as a grantor-type trust for not only income tax purposes but for capital gains tax purposes. For a husband and wife, this means the first $500,000 of capital gain is exempt from taxation. For a single person, the first $250,000 of capital gain is exempt from taxation. The home must be your principal residence for at least two of the five-year period immediately preceding the date of sale. What is becoming more of a concern with deeding the home outright to the children reserving a life estate in the home by the parents is the greater likelihood of a child dying prior to the parents. With life expectancy so long with medical technology, it is not uncommon for one of the parents to reach the age of 90, 95 or even 100. Consequently, may have a situation where a child dies of some cause age 65 or 70. These situations unfortunately do occur. In the deed with a life estate plan, since the home was deeded directly to the children, the child who has now died has an estate that needs to be probated. If, however, the home was placed into an irrevocable trust, the predeceased child’s trust share would be held in further trust for his or her children. If that child had no children, his or her share would be distributed to the surviving siblings. This dispositive scheme would be pursuant to the terms of the trust, not the Last Will and Testament. There would be no involvement by the probate court. This would result in significantly less legal fees, time and complexity when compared to the probate process. 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. Like us on Facebook advocate newspaper Facebook.com/ Advocate.news.ma ~ In Loving Memory ~ MARK GASPARELLO May 1, 1964 - Dec. 30, 2016 You will never be forgotten. We miss you. We love you. All The Family ~ LEGAL NOTICE ~ CONSERVATION COMMISSION NOTICE OF PUBLIC HEARING Notice is hereby given in accordance with the provisions of Chapter 131, Section 40, Wetlands Protection Act (as amended) of the Massachusetts General Laws that a Hearing of the City Of Malden Conservation Commission will be held on Tuesday, January 4, 2022 at 7:00 p.m. via Zoom and in person at Malden City Hall, 215 Pleasant St, 1st floor conference room. Hearing of a Notice of Intent (NOI) by Boston Gas Company for the proposed renovation of the existing buildings, parking lot, landscape enhancements, and utility improvements at 100 Commercial Street. Work is proposed within the previously developed 100-foot buffer to Bank. On June 16, 2021, Governor Baker signed into law An Act Extending Certain COVID-19 Measures Adopted During the State of Emergency. This Act includes an extension, until April 1, 2022, of the remote meeting provisions of his March 12, 2020, Executive Order Suspending Certain Provisions of the Open Meeting Law. In person attendance of this meeting is allowed, as well as, in the manner specified below, via remote access by internet, telephone, and if available via public broadcast of the meeting by Malden Access Cable Television on public access television channels. Public access will also be provided by posting draft minutes, and/or a transcript, recording, or record of the meeting on the City of Malden website at cityofmalden.org as soon as practicable after the meeting. Additional information/guidelines for the public can be found here: https://www.mass.gov/service-details/updated-guidance-on-holding-meetingspursuant-to-the-act-extending-certain-covid-19-measures Meeting information is as follows: https://cityofmalden.zoom.us/j/95040460685?pwd=SmlWbkdyRWFhayt5dmFJWk43eUVSUT09 Meeting ID: 950 4046 0685 Passcode: 285076 Dial by Number +1 929 436 2866 US (New York) Find your local number: https://cityofmalden.zoom.us/u/akmsKcsWc Isaac Slavitt Chairman December 24, 2021
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