[John Courte]

Or: what to put on the bill of sale and registration when transferring ownership to a living trust?

There's the bill of sale and registration. In 8050-2, the bill of sale, there's the purchaser section, which has me stumped, mostly because I'm afraid of messing up my current registration status.

Do I write "Last Name, First name Middle Initial and Last Name, First Name Middle Initial as trustees of Last Name Living Trust" in the purchaser section?

The confusing part is the "if individual, give last name, first, middle initial." Does that mean that any named individual should be in that format or only if the ownership is being transferred to an individual or group of individuals?

I'm sure I'm overthinking this.

 

[RV Wannabe]

I don't know the answer to your questions as I have thought about doing this but have not done all the research.

I am leaning towards not putting the plane in a trust for a couple of reasons:
1. My state would want a new sales tax payment. The new registration name would trigger this.
2. Liability; anything else in the trust would be open for the taking in the event of a liability issue. Would a person do a trust just for the airplane, and then a separate one for the rest of their assets?

Just thoughts, I would love to know more on the subject.
Mark

 

[DanBaier]

See http://www.faa.gov/licenses_certifi...stry/aircraft_under_personal_family/?print=go

As to sales tax, researching NY the answer is that as long as no cash changes hands, there is no tax. (Ie., you put the aircraft into the trust at $1+OVC.)

When I looked into this, the circumstances are for a revocable grantor trust.

Insurance wasn't a problem either - they evidently don't do this a lot, but it's no big deal.

Dan

 

[LettersFromFlyoverCountry]

We set up a living trust a couple of years ago and the lawyer was very firm in telling us that we really didn't want to put the plane in the trust because it invites all sorts of scrutiny from the government. Something about money laundering and drug dealing.

 

[rv7boy]

John, seriously, you should seek the services of an attorney in your state who specializes in this. You can get any and all kind of advice on the internet, even from your fellow VAF-ers!

In some states an LLC might be the way to go, but I'm not a lawyer.

 

[John Courte]

My intent is not to dodge liability or hide the airplane from the tax man. It's so my survivors don't have to slog through probate in the event I get knocked off my motorcycle by something like a flying mattress suddenly liberated from the top of a speeding hatchback.

Bob, the money laundering angle is interesting, I didn't think of that.

 

[DanBaier]

The estate laws vary so much by state that you really need to speak with a seasoned attorney.

A simple revocable grantor living trust is not likely to do anything at all to avoid taxes or change them in any way. However, it can provide some relief from probate (depending on the state and the family circumstances) where the process could be cumbersome (say, an out of state personal representative; who and where the beneficiaries are situated and their circumstances) and that can be a significant benefit.

The original question was basically - "...can I do it...." Yes you can. That the FAA has a web page devoted to how is an indication that it isn't a particularly unusual arrangement.

The other question as to whether it's a good idea depends on the discussion with your attorney and accountant - there are a lot of issues to be considered and the complexities probably aren't addressed well in the forum. For many, the answer may well be keep it out of the trust; however, for many others it could be the better choice.

FWIW I will say that I'm not being followed by people in black SUVs. Good luck.

Dan

 

[RV7ator]

It can be done, but the FAA wants a copy of the entire trust document, not just a certificate of trust as would satisfy most any other entity. That's too much government intrusion from the get-go, and you can bet it will be neigh unto impossible for the executor to deal with selling the airplane out of the trust with the FAA looking over their shoulder. Keep government out of your business.

Our aircraft are titled in one name (mine). Most living trusts have pour-over provisions to drag personal property into the trust to avoid probate activity. Check with your trust attorney. Furthermore, if it was my wife selling off my toys, she knows enough to sign my name to the 8050-2 and shut up.

John Siebold

 

[Bill.Peyton]

Depending on the State, your liability exposure could be more if you have a combined trust and put the aircraft in the trust. In Missouri, joint property cannot be enjoined in a lawsuit. Keep the aircraft in just one name, or a corporation/LLC owned only by you.
You really need to speak with an attny