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Planning for Incapacity Protecting Your Future & Preserving Your Assets

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Life is unpredictable, and having a comprehensive plan in place is the most effective way to protect yourself and your loved ones. Join us for a dinner and informative presentation exploring the essential legal steps necessary to navigate potential incapacity. We will discuss how to address personal and legal challenges, strategies for asset preservation, and the importance of having a plan that ensures your wishes are honored.

Limited space. Kindly RSVP to Senior Advisor Taylor Burns.
781.251.6630 | tburns@bridgesbyepoch.com

Key Issues to be Aware of When Transferring Real Estate to a Revocable Trust

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Transferring a home or other real estate into a revocable living trust is a common estate planning strategy designed to avoid probate, maintain privacy, and streamline management of property during incapacity. While the concept sounds straightforward, the process can raise legal, financial, tax, and practical issues that are often overlooked. Understanding these considerations in advance will help prevent unintended consequences and costly corrections later.

Below are some important issues to keep in mind when transferring real estate to a revocable trust.

1. Creating a Trust does not mean the Property is in the Trust. 

A common misconception is that once a trust is signed, your property is automatically part of it. Unfortunately, that is not the case. To receive the benefits of probate avoidance, privacy, and easier management, the property must actually be transferred into the trust. 

For real estate, this means preparing a new deed that transfers ownership from the current owner(s) to the trustee(s) of the trust. That deed must then be properly signed and recorded at the appropriate Registry of Deeds. Without this step, the property remains outside the trust – even if the trust itself has been signed.

2. Mortgages Require Extra Attention

If the property has a mortgage, it is important to understand how a transfer to a trust may affect the loan. Many mortgages include a “due-on-sale clause”, allowing the lender to demand full repayment if ownership changes. 

The good news is that federal law – the Garn-St. Germain Act – generally protects homeowners in this situation. The Act prohibits a lender from invoking the due-on-sale clause with respect to most residential property, provided the property is transferred to one of the people/entities listed in the Act.  When residential property is transferred to a revocable living trust and the borrower remains a beneficiary of that trust, the lender is not allowed to enforce the due-on-sale clause solely because of the transfer.

That said, this protection does not always apply to commercial real estate or commercial loans. If your property falls into that category, reviewing the loan documents before making the transfer is essential. 

3. Don’t Forget About Homeowner’s Insurance. 

Any change in property ownership should be reported to your homeowner’s insurance company. Failing to do so could create coverage problems if a claim arises after the transfer. 

It is important to advise the homeowner’s insurance company of any change in the title/ownership of real property to ensure that coverage remains in place following the transfer. In most cases, the solution is straightforward: the Trust or Trustees are added as an additional insured or named insured on the policy. A quick call to your insurance agent can usually take care of this step.

4. Review Your Title Insurance Coverage

Title insurance is a type of insurance that protects property owners and lenders against losses caused by problems with the legal ownership (i.e. title) of real estate which were not discovered at the time the property was purchased. If you have a mortgage, you likely paid for a lender’s title insurance policy at closing. This policy protects the lender—not you.

Owner’s title insurance, which is optional and is purchased at an additional cost, protects the property owner and generally lasts as long as that person owns the property. An Owner’s Title Insurance policy is for the benefit of the owner of the property and the coverage remains in effect so long as the person owns the property which is where transferring the property to a Trust can be a trap for the unwary.  This is where transferring property to a trust can sometimes cause confusion. Newer title insurance policies often state that coverage continues after a transfer to a revocable trust where the owner remains a beneficiary. Older policies may not include this language.

Title insurance policies issued in the last 10 years or so often contain a provision specifically stating that coverage remains in effect following the transfer of the property to a revocable trust of which the owner is a beneficiary.  If your policy is older, the title company may require an endorsement to reflect the new ownership and keep coverage in place.

Transferring real estate to a revocable trust can be a smart and effective planning tool, but it is not simply a paperwork exercise. The above represent just a few of the issues that should be considered when transferring real estate.  Paying attention to deeds, mortgages, insurance, and title coverage can help ensure the transfer works as intended. With thoughtful planning and professional guidance, you can protect your property, preserve valuable benefits, and avoid unintended consequences down the road.

 

Attorney Leah A. Kofos is an attorney with the Dedham firm of Samuel, Sayward & Baler LLC, which focuses on advising its clients in the areas of trust and estate planning, estate settlement, and elder law matters. This article is not intended to provide legal advice or create or imply an attorney-client relationship. No information contained herein is a substitute for a personal consultation with an attorney. For more information visit ssbllc.com or call 781-461-1020.

© 2025 Samuel, Sayward & Baler LLC

5 Estate Plan Resolutions

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Happy New Year! 

It’s now 2026, and many of us are looking for ways to start the new year on a good foot. In this week’s article, we look at 5 Estate Plan New Year’s Resolutions. 

1. Review/Update your Estate Plan

After setting up your estate plan, it’s nice to sit back and take a sigh of relief. However, your estate plan is not something you should neglect after completing it. Every couple of years or so (or after any major event in your life), you should review your estate plan to see if (a) your named fiduciaries still make sense, and (b) your distribution of your assets after death is still what you would like. For many families, there are two major transition points where they change their fiduciary designations from parents to siblings/friends and then from siblings/friends to their adult children. Marriages, births, and deaths in your family can also spark needed changes.

2. Organize Financials/Passwords for Fiduciaries

A comprehensive estate plan will have fiduciaries listed to help you if you become incapacitated and to manage your affairs after you’ve passed away. These agents have important jobs, and the best thing you can do to thank them is to organize your financial information and passwords in advance. Creating a spreadsheet of your financial accounts (including bank, retirement, investment, etc.) can be invaluable to the person who steps in to manage your affairs. In a similar vein, creating a system to allow others to access passwords to your email and other online accounts can make payments like utilities much easier for them. 

3. Trust Funding

If you created a trust as part of your estate plan, it is important to make sure your trust is funded properly. “Funding” a trust means to assign title of assets to your trust or to list your trust as a pay-on-death or transfer-on-death beneficiary. If your trust is not properly funded, assets may need to pass through your estate to get to your trust. This means that those assets will need to go through probate (often a major purpose of creating a trust is to avoid probate). You should reach out to your estate planning attorney with any trust funding questions to make sure you are optimally funding your trust.

4. Give Out Health Care Proxy

Your Health Care Proxy is your true “emergency” estate planning document that allows your listed Health Care Agent to make health decisions for you when you are unable to do so yourself. Because it may need to be activated unexpectedly, it’s important that your Health Care Proxy is accessible to others. We recommend that all your Health Care Agents, including back-ups, have copies (PDFs are fine) of your Health Care Proxy. We also recommend that you give a copy of your Health Care Proxy to your doctors (often this can be done online by uploading it to your Health Portal). Some phones also permit you to have a copy of your Health Care Proxy easily accessible in an app.

5. Talking with your Family about your Estate Plan

Talking about death and incapacity can be a difficult conversation, especially with your closest loved ones. However, for older clients in particular, having these discussions with your loved ones while you are able and healthy can make future trials easier on everyone. In this way, finding time to sit down with your family to review your estate plan can be extremely beneficial. Another similar approach that people take is to write letters to your loved ones to include in your estate plan binder. These letters can explain uncomfortable realities in your estate plan such as unequal distributions, favoring one child as a fiduciary over another, etc., and can do a lot to reduce tension after you pass away.

To Gift or Not to Gift: Understanding Basis

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As the holidays race toward us, our thoughts turn to the perfect gift for everyone on our list. It is also the time of year when many of our clients think about making larger gifts to family members and want a refresher on the gifting rules.

Although understanding the gift tax rules is important, there are other factors beyond those rules that should be considered if you are considering making a large gift, whether during the holidays or at any time of year. One of the least understood but more important factors is basis, which is impacted by whether an asset is gifted or inherited.

Basis is generally the tax cost of an asset, which is used to compute capital gain or loss when that asset is sold. Gifts of cash have no capital gain tax implications, but gifts of assets like stock or real estate that have a tax cost and have appreciated in value since the asset was purchased carry with them significant capital gain tax implications if and when that asset is sold. Federal income tax rules treat the tax “basis” of property differently depending on whether it is received by gift during life or inherited at death, and these differences impact the amount of future capital gains tax that will be paid upon a sale. Understanding these differences will help you evaluate whether to give a certain gift during your lifetime or wait to give that gift after your death.

The general rule is that when an asset is transferred by gift, the gift recipient (the donee) takes the gift giver’s (the donor’s) tax basis in that asset, often referred to as “carryover basis.” If, as is often the case, the donor’s tax basis is lower than the current value of the asset at the time of the gift (i.e. the asset has appreciated), the unrealized gain “carries over” to the donee. A later sale of the asset by the donee will result in the donee having to “recognize” this built-in gain and pay capital gain tax on the difference between the tax basis and the sale price. If you are giving a gift of an asset that has appreciated in value, you should give the recipient any records you may have that document the asset’s purchase price and anything else that may be relevant to your tax basis in that asset.

For example, if you purchased Microsoft stock for $100,000 many years ago, it is now worth $300,000, and you give your Microsoft stock to your son as a gift for the holidays, your son’s tax basis in the Microsoft stock is $100,000, and he still has your $200,000 unrealized gain. If your son later sells the stock for $320,000, his long-term capital gain is $220,000, and his combined state and federal capital gain tax will be anywhere from 5% ($11,000) to 25% ($55,000).

The general rule for an asset that is inherited from a deceased person is very different – and generally more favorable to the recipient. An asset acquired from a deceased person has a basis equal to the asset’s “fair market value” on the date of the deceased person’s death. This is commonly called a “step-up” in basis when the asset appreciated during the decedent’s lifetime, but it can also be a “step-down” if the asset declined in value. The step-up in basis essentially wipes out all pre-death unrealized capital gains, which can result in significant capital gain tax savings if the recipient intends to sell the asset.

For example, if you hold your Microsoft stock in which you have a tax basis of $100,000 until you die and leave it to your son in your Will or Trust, and if the Microsoft stock is worth $300,000 at your death, your son’s tax basis in the Microsoft stock is “stepped up” to $300,000. If he sells the stock shortly after your death for $320,000, his gain is only $20,000, and his combined state and federal capital gain tax will be anywhere from 5% ($1,000) to 25% ($5,000). Holding the asset until death has effectively avoided capital gains tax on the $200,000 of pre-death appreciation.

When considering whether to gift appreciated assets prior to death, take the following into account:

  • Gifting allows the donor to shift wealth and may reduce the estate tax payable at the donor’s death, but the carryover basis may result in significant capital gain tax if the gifted assets are sold. Consider gifting assets with little or no built-in capital gain or cash.
  • Retaining assets until death is usually more favorable for low-basis, highly appreciated assets, to take advantage of the step-up in basis on inherited assets, particularly if the donor’s estate is unlikely to incur estate tax.
  • Consider the estate tax rates. For example, if the donor’s estate will not pay federal estate tax (because the donor’s estate is less than $15 million in value) but is likely to pay Massachusetts estate tax (because the donor’s estate is over $2 million in value), the estate tax rates in Massachusetts (which range from 6% to 16%) may be lower than the capital gain tax that would be paid if the same asset was given to the intended recipient prior to death and later sold.
  • The interplay of the federal estate and gift tax exclusions, portability of the federal estate tax exemption, and state estate taxes can influence whether lifetime gifts or inheritance provide a better tax outcome.
  • Different types of assets have different rules about basis. For example, tax-deferred assets such as traditional IRAs, deferred compensation, etc. do not receive a basis step-up at death and remain taxable as ordinary income when collected by beneficiaries.

In short, deciding whether to gift or hold an appreciated asset requires looking beyond gift tax rules to the often-overlooked impact of basis and future capital gains taxes. The most tax-efficient strategy will depend on the type of asset, its built-in gain, your overall estate, and the federal and state tax landscape. Because these rules are complex and highly fact-specific, consulting with an estate planning or tax professional before making significant gifts can help ensure your generosity achieves its intended result. If we can assist you in determining the best approach for your gifting this holiday season, please do not hesitate to reach out to one of our attorneys.

Attorney Leah A. Kofos is an attorney with the Dedham firm of Samuel, Sayward & Baler LLC, which focuses on advising its clients in the areas of trust and estate planning, estate settlement, and elder law matters. This article is not intended to provide legal advice or create or imply an attorney-client relationship. No information contained herein is a substitute for a personal consultation with an attorney. For more information visit ssbllc.com or call 781-461- 1020.

© 2025 Samuel, Sayward & Baler LLC

Five Things a Successor Trustee Needs to Do When the Grantor Dies

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Most people feel honored to be named as a successor Trustee as it signifies that the grantor (trust maker) has great faith and confidence in them.  However, with that honor comes a lot of responsibility and potential liability if the Trustee does not carry out their duties properly and timely. 

Here are five tasks that a successor Trustee typically must take care of soon after the grantor dies.

1. Engage an experienced trusts and estates attorney.   One of the first steps that a successor Trustee should take is to hire an experienced trusts and estates attorney.  While serving as Trustee is an honor and can be a rewarding experience, it is also a new experience for most family members or friends who are named to this position.   There are significant responsibilities that a Trustee must carry out, some of which are time sensitive.  Engaging an experienced estates and trusts attorney will protect the successor Trustee from liability by ensuring that they are properly advised as to their duties.

2. Review the Trust.   Although it may seem obvious, one of the first things a successor Trustee should do is read the Trust, including all amendments.  Think of the Trust document as the instruction manual from the grantor.   The Trust will identify the beneficiaries, set forth the distribution instructions, direct how the assets are to be managed, and grant the Trustee the authority to act on behalf of the Trust.  One of the first tasks of the successor Trustee is to update the Trust documentation to reflect that he or she is now the Trustee and to obtain a taxpayer identification number for the trust. The estate and trust attorney will assist with these tasks.

3. Notify interested parties.  While each state will have specific requirements for notifying beneficiaries and/or interested parties, most states require that the Trustee provide notice to the Trust beneficiaries.  In Massachusetts, trust law is governed by the Massachusetts Uniform Trust Code which requires the Trustee to send written notice to the beneficiaries within 30 days of the Trustee’s appointment.  The notice must inform the beneficiaries that they are a beneficiary under the Trust and must provide the beneficiaries with the name and contact information for the Trustee.

4. Secure and inventory all Trust assets.  Once authority to act as Trustee has been established via the successor Trustee documentation, the next job of the successor Trustee is to identify the Trust assets and obtain access to those assets.  Trust assets may include bank accounts, investment accounts, real estate, and life insurance or other assets that name the Trust as the beneficiary.  The Trustee will need to contact the financial institutions to update the Trust accounts with the new taxpayer identification number and to add themselves to the accounts.   The successor Trustee should obtain date of death values for the Trust assets. This is important not only for the purpose of accounting to the Trust beneficiaries but for tax purposes.  Date of death values can be obtained from the financial institutions with respect to bank accounts and investment accounts.  For real estate, the Trustee will need to arrange for an appraisal of the property.

5. Identify time sensitive tasks.  The successor Trustee should work with the trusts and estates Attorney to create a timeline of deadline driven tasks.  These may include making sure the decedent’s required minimum distribution from his retirement account is made, filing personal income tax returns for the decedent, filing income tax returns for the trust, filing an estate tax return, if required.   In addition, there may be ongoing expenses that need to be paid such as a monthly mortgage payment or car payment.  It is important for the Trustee to understand their obligations to pay, or not to pay, debts of the decedent. There are also time frames for making distributions to the beneficiaries named in the trust. Missing these deadlines can result in penalties and interest for which the Trustee may be personally liable.

Most people feel that being named as Trustee is a great honor.  It means that the trust maker had faith and confidence that you could perform the duties and responsibilities required by the job.  Live up to those expectations by following the terms of the Trust and carrying out the trust maker’s instructions. 

Attorney Sean M. Downing is an associate attorney with the Dedham, Massachusetts law firm of Samuel, Sayward & Baler LLC, which focuses on advising its clients in the areas of trust and estate planning, estate settlement, and elder law matters. This article is not intended to provide legal advice or create or imply an attorney-client relationship. No information contained herein is a substitute for a personal consultation with an attorney. For more information visit ssbllc.com or call 781-461-1020.

December 2025

© 2025 Samuel, Sayward & Baler LLC

 

So You’ve Been Named as a Trustee — Now What?

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Few moments in life bring such a mix of honor and anxiety as being named as a Trustee. It’s an important role — a sign that someone trusted you deeply — but it’s also a serious legal and financial responsibility. Trustees are tasked with managing the assets of a trust for the benefit of others, often in accordance with complex estate plans and detailed state and federal laws.

If you’ve just learned that you’re a Trustee, take a deep breath. The job can seem overwhelming, but with the right information and professional help, you can fulfill your duties properly — and protect yourself along the way. Here’s where to start.

  1. Get the Documents — and Get Oriented

Your first step is to locate the trust documents. These documents spell out your responsibilities and the specific instructions about how assets should be managed or distributed.  Make sure you have all of the relevant documents, including all amendments that may have been made to the Trust since it was created.

If you can’t find the trust documents in the decedent’s files, don’t panic. Try to determine who drafted the estate plan — often, the estate planning attorney will have retained the original documents or, at the very least, copies in their files. Attorneys typically keep these documents for many years, so tracking them down can save you considerable confusion later.

Once you have the trust documents in hand, read through them carefully (ideally with professional help) and make note of:

  • Who are the beneficiaries? These are the people (or sometimes organizations) who will receive benefits from the trust.
  • What are your duties?  Some trusts require ongoing management of trust assets; others call for an outright distribution of assets to the beneficiaries.
  • Any specific conditions? For example, a trust might direct you to pay out funds only after a beneficiary reaches a certain age, or to provide annual distributions of income only.

It is also important to understand what assets are owned by the trust, and which assets are not owned by the trust. Understanding these basics gives you the foundation you need to move forward responsibly.

  1. Hire an Attorney — Don’t Go It Alone

Acting as a Trustee is not just an act of goodwill — it’s a legal position with fiduciary duties. That means you are legally obligated to act in the best interests of the beneficiaries and to follow the trust’s terms to the letter. Because even well-intentioned mistakes can have serious consequences, it’s crucial to get legal help early.

A trusts and estates attorney can guide you through the process, help interpret the legal language of the documents, and ensure you stay compliant with all requirements. If you know who prepared the estate plan, consider hiring that same attorney — they already understand the decedent’s intentions and are familiar with the structure of the trust.

A good attorney can also help you avoid common pitfalls, such as prematurely distributing assets, mismanaging investments, or failing to file required tax forms.

  1. Don’t Forget the Taxes

Another key part of your responsibility is making sure all tax filings are properly handled. These include fiduciary income tax returns, and if you are also named as the Personal Representative of the estate, the decedent’s final personal income tax return and potentially state and/or federal estate tax returns. In Massachusetts, an estate tax return is required if the total value of the estate exceeds $2 million. Missing or incorrectly filing these forms can delay the administration of the estate, require the payment of unnecessary penalties and interest, and even create personal liability for you as Trustee.

It’s wise to consult both your attorney and a qualified accountant who has experience with estate and trust returns. Together, they can help ensure every requirement is met and all deadlines are observed.

  1. Managing Ongoing Trust Assets

Not all trusts end quickly. Some are designed to last for years, even generations, providing income or support to beneficiaries over time. If you’ll be overseeing assets for an extended period, consider engaging a financial advisor who understands fiduciary investing. A financial professional can help you create an investment policy that aligns with the trust’s goals, balance risk and return appropriately, and keep proper records of investment performance and distributions.

Remember, as Trustee, you’re required to manage the trust’s assets prudently — not just with good intentions, but according to a reasonable standard of care. Delegating to qualified professionals helps you meet that standard.

  1. Protect Yourself 

This point cannot be overstated: a Trustee can be held personally liable if something goes wrong. That means if you mishandle funds, overlook taxes, or distribute assets prematurely, you could be on the hook to make things right out of your own pocket.

To safeguard yourself:

  • Keep detailed records of every dollar that moves in or out of the trust.
  • Don’t rush to distribute assets until you’re confident that all debts, taxes, and administrative expenses have been paid.
  • It’s often wise to hold back a reserve of funds to cover final costs — such as professional fees, income taxes, or other lingering obligations — before making final distributions to beneficiaries.
  • Make sure you work with an attorney to prepare comprehensive receipts that the beneficiaries sign in exchange for their distributions, which will not only acknowledge receipt but also release the Trustee from liability and agree to refund assets they have received if an unexpected obligation arises.

Once you’re confident that all obligations are met, get the green light from your attorney so that you can make final distributions to the beneficiaries without worry.

Final Thoughts

Serving as a Trustee can be both challenging and rewarding. You’re stepping into a role that requires diligence, organization, and sound judgment — but also one that honors the trust someone placed in you. By gathering the right documents, assembling a team of professionals, and moving carefully through each step, you can fulfill your duties faithfully and protect yourself in the process.

Being a Trustee isn’t easy, but you don’t have to do it alone — and with the right support, you can carry out your responsibilities with confidence and integrity.

 

Attorney Leah A. Kofos is an attorney with the Dedham firm of Samuel, Sayward & Baler LLC, which focuses on advising its clients in the areas of trust and estate planning, estate settlement, and elder law matters. This article is not intended to provide legal advice or create or imply an attorney-client relationship. No information contained herein is a substitute for a personal consultation with an attorney. For more information visit ssbllc.com or call 781-461-1020.

© 2025 Samuel, Sayward & Baler LLC

Wills • Trusts • Elder Law • Long-Term Care Planning • Estates

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