THE CURIOUS CASE OF QPRTS: UNDERUSED AND UNDERAPPRECIATED
By Bruce Givner, Esq. and Owen Kaye, Esq.*
Qualified personal residence trusts ("QPRTs") have been available for nearly twenty years.1 They have been recognized as excellent structures for both estate tax and asset protection planning for equity in the residence,2 which is often the most emotionally important family asset. Numerous authoritative texts and articles provide guidance on important QPRT drafting and tax issues.3 The IRS has issued helpful rulings.4 Yet, a 2001 article noted that "QPRTs…remain underutilized,"5 and empirical evidence suggests that little has changed since then.6 Current economic uncertainties, which create fear in the minds of homeowners, and favorable nontax precedent (discussed below), warrant a fresh, straightforward reconsideration of QPRTs.
II. TRANSFER TAX ADVANTAGES