Insights

Have You Considered the Future of Your Family’s Vacation Home?

by Sequoia Financial Group

June 12, 2025

Vacation season is here! Whether you call it a cabin, cottage, vacation home, or second home, it may not just be an asset, but a space full of memories. This can add complexity when deciding how to transfer ownership of the real estate upon death, disability, or shifting priorities.

The first step in considering the transfer of vacation home ownership is to have a family conversation to determine whether anyone is interested in keeping it within the family. If a child is interested, is that child willing to own the property in lieu of some other inheritance? Is the interested child able to pay ongoing expenses and provide maintenance for the home? If multiple children are interested, do the siblings get along and could they be co-owners of the home? The sooner these questions are addressed, the more time there will be to put a plan into place.

Once you decide upon future ownership of the vacation home, there are numerous strategies that can be implemented depending on your desires:

Outright Gift or Sale: Transfer the title of the home through a gift or sale.

Limited Liability Company: Transfer partial ownership over time and create a maintenance fund for the recipient of the home.

Revocable Trust or Transfer on Death (TOD) Deed: Facilitate the transfer upon death to avoid probate for the home.

Irrevocable Trust: Transfer the home outside of your estate, which may force you to “pay rent” for usage of the space in exchange for potentially saving on estate taxes.

All these scenarios could have various tax implications for you. If you are contemplating transferring ownership of a home, it is important to also integrate it with your overall estate plan. Please contact your Sequoia advisor if you have questions or would like to explore the inclusion of a vacation home in your overall wealth transfer strategy.

INTERESTED IN READING MORE ON THIS TOPIC?

Look for the seventh edition of Saving the Family Cottage by Ann O’Connell and Timothy B. Borchers at your local library or bookstore.

The views expressed represent the opinion of Sequoia Financial Group. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and nonproprietary sources that have not been independently verified for accuracy or completeness. While Sequoia believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and Sequoia’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in equity securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. Past performance is not an indication of future results. Investment advisory services offered through Sequoia Financial Advisors, LLC, an SEC Registered Investment Advisor. Registration as an investment advisor does not imply a certain level of skill or training. The tax and estate planning information offered by the advisor is general in nature. It is provided for informational purposes only and should not be construed as legal or tax advice. Always consult an attorney or tax professional regarding your specific legal or tax situation. Clients requesting tax return or estate preparation services are referred to a commonly-held affiliate, Sequoia Tax Services or a third party and not Sequoia Financial Group.