What are the options for a family cabin when one child does not want to inherit?
Minnesota estate planning attorney Karen Schlotthauer discusses options when not all heirs want to own the family cabin.
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How do you handle a situation with a cabin where one child wants it and the others don’t? In a situation like that, you could certainly leave the cabin to the child that wants it. Just outright, free of trust. You don’t have to make sure that everything is equal, but if your goal is to equalize with your kids, then if you have other assets, you would distribute those other assets to the two children who won’t receive the cabin. If, on the other hand, you don’t have enough assets to equalize or there’s other situations that come up, we can, again, utilize a trust to hold that cabin. We can fund it appropriately. We would obviously need to leave an out for the kids who aren’t interested. Enough money in it to pay ’em off for their one-third share, for example, of that cabin.
The key is communication. Many parents think that every child wants to continue to own a cabin, for example. It was their family place to go and hang out. That’s not always the case. So my first recommendation to parents is always have an open and frank discussion with the kids, see who’s interested, see if they can financially handle ownership of that cabin. That will help to dictate then what kind of trust would be needed and to what sophisticated level it has to go.