Keeping Your Home Address Private Through a Confidential House Trust
Keeping Your Home Address Private
As a part of their estate planning, many of our celebrity clients want to keep their home address private for obvious reasons. We are able to do this through a confidential house trust.
Many of our clients who are not in the public eye also want anonymity. Why do they care? Let’s first take a look at what information is readily available to the public.
Information Available to the Public
This is going to sound creepy: If you own a home, I can likely find out where you live, how much you paid and on what terms you purchased the property. I can also figure out whether you are married and if you have done any estate planning previously. There’s probably additional information I could find if I really cared to look. Unfortunately, access to this information is not limited to professionals who need this information to assist clients with their estate planning. Any member of the public can likely find this information with relative ease.
This information may be important to celebrity stalkers and asset protection attorneys, but it is also useful to potential creditors and their attorneys, who are doing some initial investigation into your assets. A potential plaintiff can have the best case in the world, but if the defendant does not have any assets, it is a loser of a case. Your cash assets are often hard to locate (at least legally), so a search of real estate is often the best way to get a general sense of someone’s net worth and whether they would make a good defendant.
Even if creditors are not a concern for you, most people would prefer to keep their home address private. Solution: Confidential House Trust.
Confidential House Trust
What is a confidential house trust? It many ways it is like a traditional revocable living trust. It is revocable and amendable by you. You are the sole beneficiary. There are no state or federal fees associated with the Trust while you are alive. The trust is tax neutral.
It is unlike a typical revocable trust in that you are not the sole trustee. Usually, you are a co-trustee. However, you can change the trustee at any time. It is also designed to give you the ultimate control over the trust even though you are not the sole trustee. The confidential house trust serves one purpose: keep your name off of title on your assets. It is not designed to replace your traditional revocable trust.
Let’s assume John and Jane Smith decide to create a traditional revocable trust called the Smith Family Trust. They will likely hold title to their home as John Smith and Jane Smith, Trustee of the Smith Family Trust. As common as those names are, there are only 28 properties matching the name “Jane Smith” in Orange County and 57 properties matching the name “John Smith.” Within 20 seconds, I could easily determine if any of those properties are owned by John Smith and Jane Smith together.
However, through a confidential house trust, John Smith and Jane Smith could keep their names completely off public record. For example, the record owner of their house could be John’s friend, Joe Schmoe as Trustee of The Private Trust. Taxes, interest deductions, etc. remain unchanged and are attributed to John and Jane. The only difference is that public record shows the property is owned by Joe Schmoe as Trustee of the The Private Trust.
Confidential House Trusts are not without hurdles. It is important that your attorney has experience using these trusts and working with lenders to assure them that this is a valid way to take title. The trust must be drafted in a way to provide the trustee just enough power to close escrow. These trusts are not for everyone. However, it is a very powerful way to keep your name off of title.
Ideally, you retain us to set up your confidential house trust prior to your purchase. However, even if your name is already on title, we can change the current owner after you have bought your home.
If you or someone you know is interested in keeping their home address private, please contact Orange County Estate Planning Attorney, John L. Wong at Modern Wealth Law, APLC to discuss your options.
John Wong advises on all aspects of estate planning, probate, asset protection and trust administration. He believes that estate planning is about planning for life; while having protections in place should the unexpected occur.
