When You Have No Heirs: Estate Planning for Wealthy Real Estate Investors

What if you built a substantial real estate portfolio but had no one to leave it to? Al Gordon tackles this advanced estate planning challenge after a Lifestyles Unlimited member approached him at a recent case study event.

 

The scenario: a married couple in their 70s with no children or heirs, owning limited partner interests in dozens of multifamily deals. They're concerned about what happens to their assets when they pass away. As Al discovered through his research, without proper planning, these assets could end up with the government.

 

Al breaks down Texas estate laws, federal tax implications, and explores various options from charitable giving to revocable living trusts. This episode provides a starting point for wealthy investors facing similar situations, though Al emphasizes the critical need for qualified professional advice.

 

What You'll Discover

Why Texas residents avoid state estate taxes but still face federal thresholds and probate challenges

The approximately $13.6 million per person federal exemption and what happens to assets above these thresholds

How partnership agreements affect your ability to transfer multifamily investment interests upon death

 

Key Timestamps

05:50 The Member's Problem - Friend approaches Al about estate planning dilemma: 70s couple with substantial assets but no heirs

15:30 Texas Estate Law Basics - Texas has no state estate or inheritance tax, only federal considerations apply

17:00 Federal Estate Tax Details - Approximately $13.6 million per person exemption, upwards of $27.2 million combined with portability

20:30 Partnership Agreement Review - Importance of understanding what your multifamily partnership agreements allow for transfers

25:00 Charitable and Non-Charitable Options - Exploring charitable remainder trusts and designating friends or organizations as beneficiaries

 

FAQs

What happens to real estate investments if you die without heirs in Texas?

According to Al's research, if assets can't be transferred to a living person or legitimate organization, they likely revert to the government. Texas has no state estate tax, but federal estate tax rules still apply.

 

What are the current federal estate tax exemptions?

As stated in the episode, the 2025 federal exemption is approximately $13.6 million per person or upwards of $27.2 million combined for couples with portability. Assets above these thresholds can be taxed at rates up to 40%.

 

Can limited partnership interests in multifamily properties be transferred?

Yes, but Al emphasizes that investors must review their specific partnership agreements to understand transfer restrictions and requirements. Differ...