1031 Exchange - Transfered to Revocable Family Trust

Cleveland, TN · Member since 2016 · 26 posts · 4 votes

When I did my 1031 exchange I of course put my up leg in the same vesting name as my sold property. It's been 3 years now and I want to place all my properties in my revocable. Zero money will be exchanged. Just want to make a quick claim from my personal name to the trust. Will there be any tax consequences? Appreciate your insight. Thank you!

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Celia Moore
Specialist · Portland, OR · Member since 2020 · 97 posts · 109 votes
3y
Jennifer, if you are the only person on title to the property and the only trustee on the trust, the property benefits and burdens will still be reflected on your personal tax returns. There should not be any tax consequences shifting the properties into the trust. We recommend talking with your CPA to verify there is nothing else in this scenario that would trigger tax!
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Dave FosterBusiness Member
Qualified Intermediary for 1031 Exchanges · St. Petersburg, FL · Member since 2013 · 9k+ posts · 9k+ votes
3y
@Jennifer Niez, A revocable trust generally does not file it's own tax return. It is what the IRS calls a disregarded entity. All activity of the property is reported on your personal return. So whether you are on deed personally or a disregarded trust, the property is still reported on your personal tax return. so the tax payer has not changed. LLCs also can be disregarded entities if they have only one member and have elected to be taxed as a sole proprietor.
Your accountant can verify your status. But about the only time this ever becomes an issue is when your property is owned by a regarded LLC taxed as an S corp. Or the property is owned by a corporate entity such as a C or S corp or registered partnership.
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Jennifer Niez
OP
Cleveland, TN · Member since 2016 · 26 posts · 4 votes
2y
Thank you!!
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