Retained Life Estate: FAQs

Do I have any other option other than having the charity take possession of the house should I want to move out of the property prior to my death?

If you negotiate a provision in the Retained Life Estate contract for the right to lease the property for the remainder of your life estate you can keep the additional money. You remain responsible for the taxes, insurance and maintenance expenses spelled out in the agreement with the charity.

Who is responsible for building modifications, additions and custom items like a work shop, extra garage or swimming pools?

You are. Most likely the RLE contract will contain a provision that requires you to get prior approval from the charity to make such improvements.

Can we move out and then back in?

Yes. The use of the asset is yours. Should you decide to lease for a while and then move back in this gifting concept allows for that. Take a long trip and let the tenants pay for it. Whoopee!

Can we use our second home to create a Retained Life Estate?

Yes. As long as the property qualifies under the IRS rules it can be used create this type of donation arrangement. I.e. you don't take depreciation or own it in a corporate structure etc. Check with your accountant to make sure it qualifies.


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