CAN I CLAIM THE REAL ESTATE TAXES AND OTHER DEDUCTIBLE EXPENSES IN A QPRT AS DEDUCTIONS ON MY INCOME TAX RETURN?

Once a residence is contributed to a QPRT during the term, the retained term, the donor of course is allowed to deduct real estate taxes and other allowable deductible expenses but at the end of the term when they no longer own the house, those are no longer deductible expenses for them. Of course, those deductions are based upon what’s permitted by law at that time.

Note: The Tax Cut and Jobs Act of 2017 signed into law in December 2017 increased the exemption amounts mentioned in these videos. The personal estate, gift, and generation-skipping tax lifetime exemption was increased to $11.18 million per person. The annual gift tax exclusion was increased to $15,000 per donee per year.

Both amounts are indexed for inflation and may increase year over year until December 31, 2025, when the law sunsets and reverts to 2017 values.