Living Trusts: Protect Your Assets And Retain Control
A trust is an arrangement in which a trustee controls property for a beneficiary. A living trust is a trust that is created while you are still alive, rather than being created by the terms of your will. Typically, you name yourself both trustee and beneficiary until you resign, become incapacitated or pass on. When that happens, the trust terms appoint a successor trustee to manage or distribute the assets left in the trust.
A living trust is assumed to be revocable unless the trust agreement specifically states otherwise. Revocable trusts may be revoked at any time before your death or incapacity, but you will not be able to change the beneficiaries, remove assets or change the terms of irrevocable trusts.
Tailoring Your Trusts to Your Needs
Although they have gained popularity in recent years, living trusts can be challenging to set up and administer, and for some clients, they may be more trouble than they’re worth.
At the Law Office of Sharon C. Stodghill, our trust lawyers can discuss the pros and cons of living trusts. Factors that we will discuss include:
- Probate: We will calculate the probable cost and expense of probate for your particular estate and the likelihood that establishing a living trust will save your family time and money.
- Taxes: Most living trusts have no effect on federal estate tax, but if you have many valuable assets, you may wish to create a more complicated living trust, such as an AB trust, which can reduce your federal estate taxes.
- Disability or incapacity: If your health indicates that you may become incapable in the near future, a living trust may make it easier for your family to manage your assets once you are incapacitated.
- Family conflict: If you are worried that your family may fight over your will, setting up a living trust may make them less likely to end up in court.