Estate Planning Tools for Real Estate Holdings

 Posted on August 31, 2025 in Estate Planning

Real estate is often the most valuable asset in an estate. In Los Angeles County, where property values continue to rise, many families own homes or investment properties worth millions of dollars. Without a proper plan, these holdings can become the subject of expensive probate proceedings, tax liability, and family disputes. The good news is that California law provides several estate planning tools that allow you to protect your property and pass it on according to your wishes.

With over 35 years of experience, the Los Angeles estate planning attorney at Law Office of David Schechet can help tailor strategies that fit your specific holdings and long-term goals.

Using a Revocable Living Trust for Valuable Real Estate 

In California, real estate that passes through a will alone must go through probate. For high-value properties, probate can last more than a year and cost a significant percentage of the estate. By transferring property into a revocable living trust during your lifetime, you avoid probate and maintain control of the property while you are alive. After death, the successor trustee distributes the property according to the trust terms, without court involvement.

Limited Liability Companies (LLCs) for Investment Properties

For families with multiple rental or commercial properties, an LLC can provide both liability protection and estate planning benefits. By transferring property into an LLC, you separate it from your personal assets. Membership interests in the LLC can then be transferred to heirs through a trust or other planning tool. This approach may also allow for valuation discounts, which can reduce estate or gift tax exposure.

Family Limited Partnerships

Similar to LLCs, family limited partnerships (FLPs) allow property owners to centralize management and control while gradually transferring ownership interests to children or grandchildren. Parents may retain general partnership control while gifting limited partnership shares. This strategy not only aids in succession planning but can also minimize estate taxes under federal law.

Transfer on Death Deeds

California law permits the use of a revocable transfer on death (TOD) deed for real property. This deed names beneficiaries who automatically inherit the property when the owner dies, avoiding probate. While simple and inexpensive, TOD deeds do not provide the same level of tax planning or creditor protection as trusts, making them best suited for modest estates.

Qualified Personal Residence Trusts (QPRTs)

For high-value homes, a QPRT allows you to transfer your residence into a trust while retaining the right to live there for a set number of years. At the end of the term, the property passes to your heirs at a reduced gift tax cost. This tool is often used when parents want to ensure children receive the family home while lowering potential estate taxes.

Charitable Remainder Trusts

Owners of valuable real estate sometimes face large capital gains taxes when selling appreciated property. A charitable remainder trust (CRT) can allow the property to be transferred into the trust, sold by the trust without immediate capital gains taxes, and then pay the donor income for life. After the donor’s death, the remainder goes to a charity. This tool can combine income planning, tax savings, and philanthropy.

Contact a Los Angeles, CA Estate Planning Lawyer

Real estate in Los Angeles is too valuable to leave unprotected. Whether you own a family home, rental properties, or commercial investments, careful planning ensures that your wishes are honored and your heirs are not burdened with unnecessary taxes or legal battles. 

With more than 35 years of experience, the Los Angeles County wills and trusts attorney at Law Office of David Schechet can guide you through trust creation, business structures, and other tools designed for your holdings. Call 800-282-4731 today to schedule a complimentary consultation.