Selling a property held in Trust

Llwyd

My parents property was transfered, to myself and my stepsister, by having drawn up a Trust dividing equally 50%. One parent remains in the property until death. However, the property is now too large to manage and my parent needs to downsize. Selling the property will create a profit, this after purchasing cheaper smaller property. My question is: What do we do with the profit? Does it have to go back into the trustfund or can it be given to the Trustees (my sister and I) or can it go back to my parent to do with as they choose?

RAS

that may well depend on what the trust says. You really need to talk to a lawyer.

Llwyd

The Deed of Trust states that another property may be 'purchased in substitution' but it does not mention anything about profit on the transaction, or what to do with it?

Llwyd wrote: »

My parents property was transfered, to myself and my stepsister, by having drawn up a Trust dividing equally 50%. One parent remains in the property until death. However, the property is now too large to manage and my parent needs to downsize. Selling the property will create a profit, this after purchasing cheaper smaller property. My question is: What do we do with the profit? Does it have to go back into the trustfund or can it be given to the Trustees (my sister and I) or can it go back to my parent to do with as they choose?

Annisele

I'd agree with RAS; if you don't know, you need to be asking a lawyer what should happen in your specific circumstances. The lawyer who set up the trust would be my first port of call in your shoes.

I suspect (though I'm not a lawyer) that if all parties agree - trustees, your parent, and any other beneficiaries - then you can do whatever you like with the profit subject to tax rules. However, that might involve some sort of amendment to the trust, and it's not something you should touch unless a) you know what you're doing or b) you've got professional advice.