Cottage Law (Indiana & Michigan)
The word "cottage" conjures up nostalgic visions of a small rustic home on a body of water where family and friends have spent fun-filled days creating memories over many years. It could actually be any home or property that a person wants to keep in the family after they are gone. The goal of cottage succession planning is to establish a legal entity that keeps the cottage in the family over multiple generations without causing family discord.
Why Develop a Cottage Plan?
Leaving the cottage to all members of the next generation "in equal shares," means everybody has to agree on everything. Virtually every family will have members of the next generation with different emotional ties, different economic resources, different views of how much they can afford to spend on vacation property, and different opinions on how to make decisions affecting the property moving forward. Parents need to consider all these issues. Failing to plan simply means the next generation will be left to "duke it out." The long term consequences of this can be disastrous to the family relationships.
Cottage Law is a fairly new practice area of law. It gained momentum in the early 1990s when states created Public Acts which provide a legal framework for changing the ownership relationship of cottage property owners. Michigan lawmakers created the "Michigan Limited Liability Company Act"(LLC) in 1993, and most states have since adopted similar limited liability company statutes. Cottage Law is a practice area at Tuesley Hall Konopa where we focus on estate and succession planning.
Contact Tuesley Hall Konopa, LLP for a free initial consultation to discuss the options for keeping your cottage in the family for future generations.
