Can You Sell a House That Is in a Trust? A Complete Guide for 2025
If you have inherited a property or placed your home in a trust, you may wonder: Can you sell a house that is in a trust? The short answer is yes, but the process depends on the type of trust, who the trustee is, and the legal requirements involved. In this guide, we’ll break down everything you need to know, including the steps, tax implications, and important updates for 2025.
Understanding the Basics: Selling a Home in a Trust
A home placed in a trust is legally owned by the trust, not an individual. This means selling it involves specific steps and approvals, depending on the trust type:
| Type of Trust | Can You Sell the House? | Who Can Sell It? |
|---|---|---|
| Revocable Trust | Yes | The grantor (if alive) or trustee |
| Irrevocable Trust | Yes, but with restrictions | Trustee, with beneficiary approval |
Key Questions to Consider:
- Who is the trustee? The trustee has the authority to manage and sell the property.
- What type of trust is it? A revocable trust is easier to modify, while an irrevocable trust requires legal procedures.
- Are there tax implications? Selling a house in a trust can have capital gains tax consequences, which vary based on trust type and location.
Step-by-Step Process to Sell a House in a Trust
- Review the Trust Agreement
- Ensure the trust allows property sales.
- Identify the trustee responsible for the sale.
- Obtain Trustee Approval
- If the trust is irrevocable, you may need beneficiary consent.
- Get a Property Valuation
- Hire a professional appraiser or get a comparative market analysis (CMA) from a real estate expert.
- List the Property for Sale
- Work with a cash home buyer like XLNC Exotic Homes to sell quickly without agent fees.
- Close the Sale
- The trustee signs the necessary paperwork, ensuring proceeds are distributed according to trust terms.
Tax Considerations When Selling a Home in a Trust
Capital Gains Tax & Step-Up in Basis
If a beneficiary inherits a home in a trust, they may qualify for a step-up in basis, reducing capital gains taxes. This means that if the original owner bought the house for $200,000 but its market value at the time of their passing was $400,000, the new basis would be $400,000.
Tax Rates for 2025
| Capital Gains Bracket | Tax Rate |
| Up to $44,625 (single) | 0% |
| $44,626 – $492,300 | 15% |
| Above $492,300 | 20% |
Consult a tax professional to ensure compliance with the latest regulations.
Common Challenges & How to Overcome Them
| Challenge | Solution |
| Trustee disputes | Work with a legal professional to mediate |
| Beneficiary disagreements | Obtain legal consent from all parties |
| Market fluctuations | Sell to a cash home buyer for a quick transaction |
Need Help Selling a Trust Property? Get a Free Consultation
Selling a house in a trust can be complicated, but you don’t have to navigate it alone. XLNC Exotic Homes offers free consultations to help you understand your options and sell your home smoothly.
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