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The KRASA LAW, Inc. Estate Planning Blog

Monday, August 21, 2017

Estate Planning for your Car Collection



This week on the Monterey Peninsula is commonly referred to as “Car Week.” What started in the early 1950’s with the Pebble Beach Concours d’Elegance and the Pebble Beach Sports Car Road Race has blossomed into perhaps the largest concentration of car events in the world. Locals who are not car enthusiasts often understandably do not look forward to the additional traffic. However, for self-proclaimed “car nuts” like my dad and me, it’s one of the most enjoyable weeks of the year. Car shows, car rallies, car displays, car discussions, car auctions, car test-drives, and historic car races have kept us busy and entertained for years. We are currently grooming my seven-year-old son to develop the same passion with a little too much success.  

One morning, with my son in the backseat ready to head out for the day, I was warming up my 1953 Chevy Bel Air (“Maybellene” - named after the Chuck Berry song).  Without provocation, he asked me: “Dada, when you die, I’m getting this car, right?” The question was jarring and I quickly realized that my little buddy had a clear understanding of estate planning! Car collections - as well as collections of any personal property - should be carefully considered when engaged in estate planning as they can present unique issues.

One of the first issues to consider is whether or not there is any desire to keep the car collection intact after death. Personal property of any kind is indeed “personal.” What can be very important to one person is of no interest to another person. It is important to inquire whether intended beneficiaries will value the collection as much as you do. If so, is it realistic that they will be able to keep it together? Issues of estate tax, maintenance, storage, and insurance must be carefully considered and addressed.

If your beneficiaries do not wish to keep your car collection and plan to liquidate, will they understand the value of each car in the collection? Are there experts and auction houses whom they can trust? Conversely, are there companies in the car industry that are untrustworthy and should be avoided? The timing of the liquidation could be important as well.  How do they know when the market is ripe for selling? Furthermore, understanding the capital gains tax implications of selling highly appreciated cars is also critical. Assembling a team of car experts and tax professionals who could be appointed to serve in an advisory capacity might be a prudent idea in some circumstances.   

Once you have established a carefully crafted estate plan that adequately addresses all of the unique issues related to your car collection, make sure that you assign or title each car to your trust in order to eschew probate and ensure the efficient management of your car collection in the event of your incapacity or death.

Taking the time to follow these steps will ensure that your beloved car collection will not become a nightmare for your loved ones after you are no longer able to directly care for your car collection.

KRASA LAW, Inc. is located at 704-D Forest Avenue, Pacific Grove, California 93950, and Kyle may be reached at 831-920-0205.

Disclaimer: This article is for general information only. Reading this article does not establish an attorney-client relationship. Before acting on any of the information presented in this article, you should consult a competent attorney who is licensed to practice law in your community.



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KRASA LAW assists clients with Estate Planning, Elder Law, Pet Trusts, Asset Protection, Special Needs Planning and Probate / Estate Administration in Pacific Grove, CA(93950), Monterey (93944, 93940, 93943, 93942), Salinas (93901, 93905, 93906, 93907), Hollister (95023,95023) Pebble Beach (93953), Carmel By The Sea (93921), Seaside (93955) and Carmel (93923, 93922) in Monterey County and San Benito California.

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