Selling a house held in a trust in Pennsylvania is generally simpler than selling through probate, which is one of the main reasons families place their homes in trusts in the first place. The trustee, the person with legal authority over the trust’s assets, has the power to sell the home, and the sale can proceed without the court supervision that probate involves. The specifics depend on whether the trust is revocable or irrevocable and on what the trust document itself authorizes. Understanding the trustee’s authority and the documentation buyers and title companies will require is the key to a clean transaction.
This guide explains how trust home sales work in Pennsylvania.
Why homes are held in trusts
People place their homes in trusts for several reasons, and the reason often determines the type of trust involved:
Avoiding probate. A home held in a properly funded revocable living trust passes to the beneficiaries without going through probate. This is the most common reason for residential trusts. The home can be sold by the trustee or transferred to beneficiaries without the time and public record of the probate process.
Estate planning and tax considerations. Irrevocable trusts are used for more advanced estate, tax, and asset-protection planning. They involve giving up direct control of the asset in exchange for specific legal and tax benefits.
Long-term care planning. Some families place homes in irrevocable trusts as part of Medicaid planning, to protect the asset from long-term care costs after the applicable look-back period.
The type of trust affects who controls the property and what the trustee can do, so the first step in any trust home sale is identifying the trust type and reading the trust document.
Revocable vs. irrevocable trusts
Revocable living trust. The person who created the trust (the grantor) typically retains control during their lifetime and usually serves as their own trustee. They can sell, refinance, or remove the home from the trust at will. When the grantor dies or becomes incapacitated, a named successor trustee takes over and has the authority to sell the home according to the trust’s terms. Most residential trust sales in Pennsylvania involve a successor trustee selling after the grantor’s death.
Irrevocable trust. The grantor has given up direct control. A designated trustee, who may or may not be a family member, controls the property and must act according to the trust document and in the interest of the beneficiaries. Selling a home from an irrevocable trust requires confirming that the trust document authorizes the sale and that the trustee is acting within their authority.
In both cases, the trustee, not the beneficiaries, has the authority to sell. Beneficiaries have an interest in the proceeds but do not individually control the property.
The trustee’s authority to sell
The trustee’s power to sell comes from the trust document. Most well-drafted trusts explicitly grant the trustee the power to sell real estate. Before listing, the trustee and the agent should confirm:
- The trust document grants the trustee authority to sell real property
- The trustee is properly appointed and currently serving
- Any conditions the trust places on a sale (such as requiring beneficiary consent or a minimum sale price) are identified and satisfied
A title company will require documentation of the trustee’s authority before closing. This typically includes the trust document itself or a certification of trust, a Pennsylvania instrument that summarizes the key terms and confirms the trustee’s authority without disclosing the full private contents of the trust. The certification of trust is often preferred because it provides the title company what it needs while keeping the trust’s full terms private.
How a trust sale differs from a probate sale
No court supervision. A probate sale, while not requiring court approval for routine transactions in Pennsylvania, operates within the structure of the estate administration and the Register of Wills. A trust sale operates outside that structure. The trustee has authority directly from the trust document.
Faster and more private. Because the trust avoids probate, the sale does not become part of the public probate record, and the timeline is not tied to probate milestones like the inventory filing or creditor notice period. This is often the entire point of the trust.
The trustee signs, not an executor. At closing, the trustee signs the deed and transfer documents in their capacity as trustee. The deed conveys the property from the trust to the buyer.
Inheritance tax may still apply. Avoiding probate does not avoid Pennsylvania inheritance tax. Assets passing through a trust at the grantor’s death are generally still subject to inheritance tax based on the relationship between the grantor and the beneficiaries. The trust avoids probate, not inheritance tax.
The capital gains question
For a home held in a revocable living trust, the step-up in basis at the grantor’s death generally applies the same way it would for an inherited home, because the assets are included in the grantor’s estate for tax purposes. This means a successor trustee selling shortly after the grantor’s death usually faces little capital gains tax, for the same reasons explained in the guide to capital gains tax on an inherited home.
Irrevocable trusts are more complex, and the basis treatment depends on the specific structure of the trust. This is a question for the trust’s attorney and accountant, and it should be confirmed before the sale rather than discovered afterward.
The practical takeaway
Read the trust document first. The trustee’s authority, any conditions on a sale, and the identity of the proper trustee all come from the trust document. This is the starting point for any trust home sale.
Prepare the certification of trust. Title companies require documentation of the trustee’s authority. A certification of trust provides this while keeping the trust’s full terms private.
Confirm the tax treatment with the trust’s professionals. Revocable trusts generally receive the step-up in basis; irrevocable trusts vary. The inheritance tax usually still applies. These questions belong with the trust’s attorney and accountant.
This guide is general information, not legal or tax advice. The trust’s attorney should confirm the trustee’s authority and the proper procedure for any specific sale.
Working with Karen
Karen Langsfeld is a REALTOR® and Pricing Strategy Advisor (P.S.A.) with Berkshire Hathaway HomeServices Fox & Roach in Blue Bell. She works with trustees and families across Montgomery County, Bucks County, the Main Line, and South Jersey, coordinating with trust attorneys to confirm authority and manage the sale cleanly.
The estate sales page covers the full range of engagements Karen handles, including trust and probate sales. Contact Karen at (215) 495-2914 or through the contact page.