Owning DVC in an estate

[theMoreDisneytheBetter]

Hi all - I’m sure this has already been discussed elsewhere but I’m not paying attention to a meeting (on my phone) and can’t really search.

My financial advisor said that timeshares are really tricky to hold in an estate. My mom and I currently own all contracts jointly. When she passes (hopefully not for many MANY years) what happens to the contracts? The financial advisor said that her half would be put into probate and have a lot of negative tax implications, but we were under the impression that they would just come to me as a joint owner. We live in the US.

Has anyone had any experience with estate planning and DVC?

Thank you.

 

[intamin]

Hi all - I’m sure this has already been discussed elsewhere but I’m not paying attention to a meeting (on my phone) and can’t really search.

My financial advisor said that timeshares are really tricky to hold in an estate. My mom and I currently own all contracts jointly. When she passes (hopefully not for many MANY years) what happens to the contracts? The financial advisor said that her half would be put into probate and have a lot of negative tax implications, but we were under the impression that they would just come to me as a joint owner. We live in the US.

Has anyone had any experience with estate planning and DVC?

Thank you.

I don't know much about it but my understanding is if you put it into a trust you can avoid probate and all of that mess. I likely will be doing so in just a couple years on all of our contracts.

 

[RoseGold]

Your "financial advisor" has no idea what they are talking about, and you need to talk to your estate lawyer. The least of your issues if you have to open probate in Florida is the taxes. This is the bare minimum of estate planning (step up in basis). If my financial advisor didn't understand that, I'd get a new one.

Lots of people title DVC in trusts or LLCs for this reason. "Joint owner" can mean a lot of things in Florida, some avoid probate, some don't.

You can also gratuitously transfer now, there are several threads on that.

 

[robinb]

My financial advisor poo-poo'd our ownership of DVC. He clearly did not understand it's real value even though we told him that it was worth $30k on the resale market. All he saw was "timeshare" and dismissed it.

I think, for you, it depends on how the contracts were deeded. If it was deeded as "joint ownership with the right of survivorship" you're OK.

 

[Genie+]

Our contract is deeded with right of survivorship, meaning each person owns an undivided interest in the entire property.

 

[radiodome21]

I put my contract in my trust. My guide knew what to do. He emailed me a document that I filled out and then had my signature notarized. Once done I scanned it back. They checked it over and it was fine. I didn’t want to add my wife’s trust because it was more work. She’s my trustee so I figured why bother. I was prompted to create a trust three years ago after dealing with the fallout of my parents never setting one up for their estate. We’re still dealing with that.

 

[sndral]

Check your title, if you own as joint tenants with right of survivorship you won’t need to deal w/ probate in Florida.
https://alainromanlaw.com/ways-to-hold-real-estate-title-for-florida-probate-purpose/.

 

[CarolynFH]

Check your title, if you own as joint tenants with right of survivorship you won’t need to deal w/ probate in Florida.
https://alainromanlaw.com/ways-to-hold-real-estate-title-for-florida-probate-purpose/.

Thank you! Bookmarked this for future reference!

 

[drusba]

What you need to do is check the deed you got when your mom and you made the purchase. If it says that the property is held in joint tenancy with right of survivorship, then upon the death of one of the joint owners, the remaining living joint owner automatically becomes the sole owner and the property is not subject to probate (until after the surviving owner dies).

If the deed says it is held by tenants in common (or just joint tenancy, which is highly unlikely to be the case with a DVC deed), and one of the owner's dies, the property will be subject to probate in the state where the property is located. In that probate the share of the deceased joint tenant will be distributed via whatever is provided in that deceased person's will, or, if none, via applicable state intestate rules that say who gets a deceased's property when there is no will.

Also note that, regardless of whether probate is required, you should bring the existence of the deed and ownership to the attention of whomever is handling the overall probate in the state where the deceased person resided, including because there might be estate taxes involved (although unlikely for most unless their total estate value is many millions when they die) and the surviving owner should likely make filings with the applicable government agency that records deeds in the county where the property is, which fillings show the death of the deceased joint owner so that there will be no issues of applicable ownership later if the surviving joint owner wants to sell the property.

 

[theMoreDisneytheBetter]

My mom confirmed that we are joint tenancy with right of survivorship so I think we are in the clear, at least for this round. Thank you all for your advice!