Setting up a trust is advantageous in many ways. A person who opts for this estate planning tool and creates a trust, however, must be aware of relevant trust rules and state law. Consulting with experienced Tacoma estate planning attorneys can help.
Not a lot are aware that a last will and testament is not the only legal document that one can use to distribute or to transfer inheritance from a deceased person. There are several estate planning documents used not only for naming family members as heirs but specifically for distributing or transferring estate assets.
Under relevant trust law, once an individual created a trust, any bank account, personal property, or real property in trust is already owned by the trust account. Since they are held in trust, they are in the name of the trust (and not of the grantor).
Why establish a trust?
Creating a trust is ideal for both the grantor and beneficiaries of the trust (which can be your would-be surviving spouse, child, grandchild, or any family member). Under basic trust law, if deceased loved ones established a trust, the trust property of the decedent need not be brought to court and probated. Avoiding probate when you die is, in fact, a common reason why a living trust is usually preferred. Because of probate costs and the lengthy proceeding involved, this is advantageous for any beneficiary of a trust. An heir you designate by drafting last wills and testaments may not be able to avoid probate the same way.
Revocable trusts, as the name suggests, could be revoked or amended virtually any time during the remainder of your life. Including a trust in your chosen estate plan is also ideal if you would want an income from trust assets to remain yours during your lifetime (even if they are taxable).
A trust you set up and the trustee you appoint
Grantors who set up a trust must choose a loved one, a bank, or a trust company who shall have the fiduciary duty of managing, investing, and administering the trust for the interest of trust beneficiaries. Note that trustees are not allowed to use property held in trust for purposes that are not specified in the trust document.
People who include trust documents (a revocable living trust) in their estate planning options also appoint a successor. The latter will carry out your wishes and continue managing and administering the trust, usually after you pass away.
When you create a trust, your successor trustee can take over in case there is incapacity (you cannot make decisions anymore), or if you want to see how your trustee will manage, invest, and administer the trust for your surviving family members and beneficiaries.
Revocable living trusts, both while you are still alive and after death
Unlike other estate planning tools, revocable trusts allow the grantor to keep control of assets and the trust beneficiary to maintain privacy.
Before creating a trust, talk to experienced Tacoma estate planning attorneys. An expert on trusts and estates can help explain to you the different types of trusts and the duties of the appointed trustee.
For questions on revocable or irrevocable living trust, trust administration, or asset protection, call our law office. Contact our reliable Tacoma estate planning attorneys at James A. Jones Attorney At Law for reliable estate planning services.