A family vacation home can be a source of lasting memories, but also potential friction. When multiple people inherit or co-own a cherished getaway, good intentions alone aren’t always enough to prevent problems. Scheduling conflicts, differing financial contributions, or a co-owner’s desire to sell can create real tension. Fortunately, there are legal tools that can help families manage shared vacation properties more smoothly and preserve them for future generations.
Why Ownership Planning Matters
When several people co-own a vacation home, whether inherited from parents or jointly purchased, issues often arise over time. One person may want to make upgrades while another prefers to keep costs down. Disagreements can emerge over who gets to use the home during peak weeks or how to divide upkeep responsibilities.
Without clear legal agreements, resolving these issues can be difficult and emotional. Creating a structure for decision-making, expense sharing, and transfer of ownership can help everyone feel heard and protected. The right legal framework can prevent disputes and ensure the property continues to be a place of enjoyment.
LLCs for Shared Property
A limited liability company (LLC) is one of the most flexible ways to manage a vacation property owned by multiple people. In this structure, each co-owner holds a “membership interest” in the LLC, which owns the home. An operating agreement outlines the rules everyone agrees to follow.
Some advantages of an LLC include:
- Liability protection: Personal assets are shielded from legal claims involving the property
- Flexible governance: Members can decide how the property is managed, how decisions are made, and who covers what expenses
- Transfer provisions: The agreement can control how and when an interest can be sold, and whether others get the first chance to buy
An LLC does require some ongoing attention, including filing annual reports with the state and maintaining proper records. For many families, however, the benefits can outweigh the administrative effort.
Family Limited Partnerships (FLPs)
Another option is a family limited partnership. This structure divides ownership between general partners and limited partners. Typically, the parents or founding generation serve as general partners, controlling decisions and daily management. Children or grandchildren may be added as limited partners with economic interests but no decision-making power.
FLPs can offer several benefits:
- Consolidated control in one or two trusted individuals
- Easier transfer of interests across generations
- Restrictions on selling to outsiders, helping preserve family ownership
This approach is often best when one person is willing and able to handle day-to-day property matters. It’s also useful in estate planning because it allows gifts of partnership interests over time while maintaining control.
Cabin Trusts and Long-Term Stewardship
A cabin trust, or more broadly, a vacation home trust, is designed to hold the property for the benefit of multiple family members. The trust document outlines specific terms, including who is authorized to use the property, how maintenance expenses are covered, and what happens when a beneficiary passes away or wishes to step away.
This structure is ideal for long-term preservation. The trustee, who is often a neutral party or trusted relative, has the authority to enforce the rules and ensure the property is maintained. The trust can also include fallback plans in case of disputes or vacancies.
While a trust can limit flexibility when someone wants to sell their interest, it provides strong continuity and prevents forced sales. For families looking to keep a beloved cottage, lake house, or beach home in the family for generations, a trust can be a thoughtful choice.
Addressing Common Co-Ownership Issues
Each of these legal structures can help manage the most common challenges families face when sharing a vacation property:
- Scheduling use: LLC operating agreements and trust documents can assign time slots or seasons to specific family members
- Sharing costs: Agreements can include fair formulas for dividing taxes, utilities, and maintenance
- Resolving disputes: LLCs and FLPs often include mediation clauses; trusts give the trustee final say
- Selling an interest: LLCs and FLPs can include buyout rules; trusts may limit exits to preserve long-term ownership
The key is anticipating these issues and putting a clear, legally enforceable plan in writing. Even close families benefit from having agreed-upon rules that apply equally to everyone.
Conclusion and Next Steps
If your family owns or expects to inherit a vacation home in Massachusetts, it’s worth thinking about how you want to manage it. Do you want long-term preservation? Flexibility? A way to keep things fair across generations? At Surprenant, Beneski & Nunes, P.C., we help families put the right structure in place so their vacation property remains a source of connection, not conflict.
Reach out to schedule a consultation and start building a plan that works for your family’s goals.
